When talking about property tax we have to consider two factors to consider total taxes paid.

 

1) The assessed value of the property. In Nevada the assessed value of a property is determined by the value of the particular property and similar properties around it. When you purchase a property in Nevada by Law you must declare the price you paid for it. This “Declaration of Value” is recorded with the County Recorders office and aids the Clark County Assessors Office in valuing your property for tax assessment purposes. This Value the Assessors assign to your property is called the “Assessed Value” (Value x 35%= Assessed Value) which is lower and different than the “Market Value” which is what your property is worth.

 

2) The Tax rate (Mil levy) is the rate of real estate tax assessed per thousand dollars of the assessed value.  This value differs from area to area. These areas are called tax districts.  These tax districts all have slightly different Mil levies based on the public services they provide.  These public services may include, libraries, art facilities, flood control, City and County governments, fire districts, schools, street improvements, lighting, parks, recreation facilities, etc.  All these facilities may require a mil levy to operate or pay off debt to continue in the public interest and thus are authorized under the law to require a mil levy. All these combined become the Property Tax Mil Levy.

 

So to answer your question we have to consider Mil Levy and Assessed Value of your property.  When the real estate market was appreciating we used a percentage of Market Value (0.75% x what you paid= yearly property taxes) to estimate taxes for our clients when they were purchasing real estate here in Las Vegas.  This number seemed to do well in giving the client an estimate of what their property taxes would be.  So the Buyers would become Owners and when the Assessor appraised their property their taxes would raise to approximately the value calculation we estimated their taxes to be.  This was great in that until the Assessor revalued the property the buyer paid lower taxes.

 

But here is how things have gotten a bit more complicated.  Now the Assessed Values are in many cases more than twice what they should be.  If you purchase a condo now you still file your “Declaration of Value” but it may be 2 to 3 years before your property is assigned a new Assessed Value.  There is a way to speed up lowering your Assessed Value and that is by contesting the value with the County Assessors Office.  Each year a statement of assessed value along with an estimate of Mil Levy calculating your real estates estimated value is sent out to all property owners in late December.  On this statement you will find specific instructions on contesting your properties tax valuation. It is a fairly simple process and for many property owners here in Las Vegas can cut their property taxes as much as 50%. By statute you must contest by January 15th of the following year.

 

The other side of the equation is mil levy. Nevada limits how much your property tax can be raised in any specific year. For primary residents it is 3% per year. For non-primary residence it is 8% per year.  As property valuations are dropped I expect these maximums to take effect in order to maintain public services.

 

So the answer to the question is this:  If you buy real estate in Las Vegas this year you will probably be stuck paying twice as much tax as you should on the property until the next annual tax levy.  If you contest the valuation when your tax statement comes through next year you will probably cut your tax bill by up to 50%.  If the tax districts estimate they will be under funded next year (a real probability) you will see your tax levies raising up to 8% if this real estate is not your primary residence. This could leave you with a 42% savings.

 

Now after all that you tell me.  Are your taxes going up or coming down.  I guess we could say both.

 

For more extensive information on Las Vegas real estate taxes see the link below.

 

Thanks for asking.