Overview of Tennessee Taxes
Tennessee has some of the lowest property taxes in the U.S. The median annual property tax paid by homeowners in Tennessee is just $1,024, ninth lowest in the country and less than half the national average.
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To calculate the exact amount of property tax you will owe requires your property's assessed value and the property tax rates based on your property's address. Please note that we can only estimate your property tax based on median property taxes in your area. There are typically multiple rates in a given area, because your state, county, local schools and emergency responders each receive funding partly through these taxes. In our calculator, we take your home value and multiply that by your county's effective property tax rate. This is equal to the median property tax paid as a percentage of the median home value in your county.
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Jennifer Mansfield Tax
Jennifer Mansfield, CPA, JD/LLM-Tax, is a Certified Public Accountant with more than 30 years of experience providing tax advice. SmartAsset’s tax expert has a degree in Accounting and Business/Management from the University of Wyoming, as well as both a Masters in Tax Laws and a Juris Doctorate from Georgetown University Law Center. Jennifer has mostly worked in public accounting firms, including Ernst & Young and Deloitte. She is passionate about helping provide people and businesses with valuable accounting and tax advice to allow them to prosper financially. Jennifer lives in Arizona and was recently named to the Greater Tucson Leadership Program.
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Tennessee Property Tax
If you are thinking about becoming a homeowner in Tennessee (or if you already are one), we’ve got good news: Tennessee has some of the lowest property taxes in the U.S. The median annual property tax paid by homeowners in Tennessee is just $1,024, ninth lowest in the country, and less than half the national average.
Those low taxes aren’t uniform across the state, however. In Memphis, Tennessee’s most populous city, rates are double the state average. Below, we’ll take a look the state’s most important property tax rules, and property tax rates from around the state.
Our Tennessee mortgage guide will help make the homebuying process a little easier by laying out the most important details about rates and getting a mortgage in the Volunteer State. You’ll also want to check it out if you are thinking about refinancing a mortgage.
Tennessee Property Tax Rules
County officials are responsible for administering the property tax in Tennessee, starting with the county assessor. The county assessor in each county is responsible for assigning a value to each property, on which taxes are based.
This is done through a regular reappraisal. Assessors reappraise property in Tennessee in four to six year cycles. The purpose of the reappraisal is to determine the current market value, on which taxes will be based until the next reappraisal in four, five or six years.
Homeowners who believe their property has been over-appraised should first contact their assessor for an informal discussion. If that discussion is not fruitful, an official appeal can be filed with the County Board of Equalization.
Taxes are not applied to that full market value, rather to the assessed value. For residential property, assessed value is equal to 25% of market value. Thus, if your county assessor appraises your property at $100,000, your assessed value will be $25,000. Your tax rate applies to that amount.
Tennessee Property Tax Rates
Tax rates are calculated by the County Commission, depending on the funding needs of local government bodies and the total value of assessed property in a district.
Rates are expressed as mills – dollars per thousand of assessed value. If your mill rate is $3.00 and your assessed value is $25,000, your total taxes will be $750 per year.
The effective rate on a property is the amount of taxes paid as a percentage of market value (not assessed value). The table below shows average effective rates for every county in Tennessee, as well as median annual tax payments and median home value.
|County||Median Home Value||Median Annual Property Tax Payment||Average Effective Property Tax Rate|
Located in southwest Tennessee, Shelby County contains the city of Memphis. It has the highest property tax rates in the state, and by a wide margin. The county’s average effective property tax rate is 1.50%, double the state average.
In Memphis, rates are especially high. The total rate in the city of Memphis is $7.77 mills. That’s $7.77 per every $1,000 in assessed value. So, for example, on a home worth $100,000 in Memphis, the assessed value would be $25,000 and total taxes would be around $1,940.
While property tax rates in central Tennessee’s Davidson County are not nearly as high as those in Memphis and Shelby County, they still rank as the second highest rates, on average, in the state. The county’s average effective tax rate is 0.99%.
The largest city in Davidson County is the state capital, Nashville. In Nashville, the 2014 property tax rate was $4.516 per $1,000 of assessed value. Of that, $3.92 was the general county tax, and $0.592 went to the city of Nashville.
Knox County is located in eastern Tennessee, at the confluence of French Broad River and Holston River. It contains the city of Knoxville, and the main campus of the University of Tennessee. It is the third most populous county in Tennessee, with a population of around 440,000.
Compared with Tennessee’s other densely populated counties, property tax rates in Knox County are relatively low. The county’s average effective property tax rate is 0.72%. In the city of Knoxville, the total millage rate in 2014 was $5.0457 mills. In most of the rest of the county, the rate was just $2.32 mills.
Situated along the Tennessee River in southern Tennessee, Hamilton County has among the highest property tax rates in the state. The county’s average effective tax rate is 0.88%, third highest in the state. In Chattanooga, the county’s largest city, the total 2014 mill rate was $5.0742 per $1,000 in assessed value (which is equal to 25% of market value). Property in Hamilton County was most recently reappraised in 2013. The next reappraisal is scheduled for 2017.
Rutherford CountyRutherford County is located southeast of Knoxville and contains the city of Mufreesboro. It is named after Revolutionary War officer Griffith Rutherford. The County’s average effective property tax rate is 0.79%. At that rate, someone with a home worth $150,000 would pay about $1,185 annually.
The median annual property tax paid by homeowners in Williamson County is $2,026, highest in the state and about double the state average. However, those high taxes are in large part due to high home values in the county. According to the U.S. Census Bureau, the median home value in Williamson County is $334,900. That is more at least $130,000 higher than any other Tennessee county’s median.
With a population of about 180,000, Montgomery County is the seventh largest county in Tennessee. Its largest city is Clarksville. The average effective property tax in Montgomery County is 0.87%, fifth highest in the state. In Clarksville, the total 2014 millage rate was $4.1579.
Sumner County is located northeast of Nashville, along the state border with Kentucky. The median annual property tax paid by homeowners in Sumner County is $1,236, seventh highest in the state. The county’s most recent reappraisal took place in 2014, which means the next reappraisal will not be held until 2019. Taxes will be based on the 2014 valuation until then.
Northeast Tennessee’s Sullivan County has property tax rates somewhat below the state average. The county’s average effective property tax rate is 0.66%, while the state average is 0.74%. In Kingsport, the county’s largest city, the total mill rate for 2014 was $4.3754 per $1,000 in assessed value.
The homeowners in Washington County pay a median property tax of just $919 annually. That is less than half the national average. Reappraisals in the county are held once every five years, with the next reappraisal taking place in 2019.
Property Tax: Which Counties are Getting the Best Bang for Their Buck
SmartAsset’s interactive map highlights the places across the country where property tax dollars are being spent most effectively. Zoom between states and the national map to see the counties getting the biggest bang for their property tax buck.
Our study aims to find the places in the United States where people are getting the most for their property tax dollars. To do this we looked at school rankings, crime rates and property taxes for every county.
As a way to measure the quality of schools, we calculated the average math and reading/language arts proficiencies for all the school districts in the country. Within each state, these schools were then ranked between 1 and 10 (with 10 being the best) based on those average scores.
For each county, we calculated the violent and property crimes per 100,000 residents.
Using the school and crime numbers, we calculated a community score. This is the ratio of the school rank to the combined crime rate per 100,000 residents.
We used the number of households, median home value and average property tax rate to calculate a per capita property tax collected for each county.
Finally, we calculated a tax value by creating a ratio of the community score to the per capita property tax paid. This shows us the counties in the country where people are getting the most bang for their buck, or where their property tax dollars are going the furthest.
Sources: US Census Bureau 2016 American Community Survey, Department of Education, Federal Bureau of Investigation, State Police or Justice Department websites