The formula
A mill is one dollar of tax per $1,000 of assessed value. Connecticut's Office of Policy and Management writes the bill as assessment times mill rate divided by 1,000, and Florida's Department of Revenue uses the same equation with taxable value. The mill rate is not set by the assessor. In Connecticut the town's board of finance or council sets it from the budget; in Florida each taxing authority, such as the county, the city, the school board and special districts, adopts its own millage, and the bill adds them up.
Assessed value is not always market value
The assessment ratio is the share of market value that gets taxed. Two state examples:
- Connecticut. State law requires every town to assess all property at a uniform 70 percent of its present true and actual value, as of October 1, and to revalue real estate at least every five years. A house worth $350,000 at the last revaluation is assessed at $245,000.
- Florida. The county property appraiser sets a just value, which is market value, as of January 1. The assessed value is the just value minus assessment limitations, and the taxable value is the assessed value minus exemptions. The tax collector bills on the taxable value.
A low ratio does not mean a low tax. A town that assesses at 40 percent needs a higher mill rate to raise the same money as one that assesses at 100 percent, which is why comparing mill rates across states says little on its own. The useful comparison is the effective tax rate: the yearly tax divided by market value.
The assessed value is a different number from the appraisal a lender orders; appraisal vs assessment compares the two.
Three bills for the same house
A home with a market value of $350,000, under three illustrative combinations of ratio and rate. None of these is a real town's rate; they show how the parts interact.
| Ratio | Assessed | Mills | Yearly tax | Effective rate | Per month |
|---|---|---|---|---|---|
| 100% | $350,000 | 15 | $5,250 | 1.50% | $437.50 |
| 70% | $245,000 | 25 | $6,125 | 1.75% | $510.42 |
| 40% | $140,000 | 40 | $5,600 | 1.60% | $466.67 |
The highest mill rate does not produce the highest bill here, and the lowest does not produce the lowest. The percentage calculator turns any tax bill and value into an effective rate, and converting mills to percent is a matter of dividing by 10: 25 mills is 2.5 percent of assessed value.
Exemptions: the homestead example
Exemptions come off the assessed value before the rate is applied. Florida's homestead exemption is the best documented example. The Department of Revenue describes it as exempting up to $50,000 of a home's assessed value, in two parts: the first $25,000 applies to all taxes, and the additional $25,000 does not apply to school district taxes. Miami-Dade County's property appraiser lists the total for tax year 2025 as $50,722, and requires that you own the home and live in it as your permanent residence on January 1 and apply by March 1.
On a home assessed at $300,000, with an illustrative 6 mills of school tax and 12 mills of everything else, the school levy is charged on $275,000 and the rest on $250,000. The bill is $4,650 instead of $5,400 without the exemption, a saving of $750 a year. Other states have homestead, senior, veteran and disability exemptions with their own amounts and deadlines; the assessor's office publishes them.
Assessment caps and the buyer's surprise
Florida's Save Our Homes amendment limits how fast a homestead's assessed value can rise: no more than 3 percent a year or the change in the Consumer Price Index, whichever is less. If the market rises 6 percent a year for 5 years on a home that started at $300,000, the just value reaches $401,468 while the capped assessed value is $347,782, assuming the cap is a full 3 percent each year.
That gap belongs to the owner, not the house. The Department of Revenue says that when the property changes ownership, the appraiser removes the exemptions and reassesses it so the assessed value equals the just value, effective January 1 after the purchase. In this example the buyer's tax base is $53,685 higher than the seller's before any exemption, which at the illustrative 18 mills is $966 a year more. Ask for the estimate at the new value, not the seller's last bill.
What it adds to the mortgage payment
Many lenders collect property tax monthly through an escrow account and pay the bill when it is due, so a yearly tax becomes one twelfth on each payment: $6,125 a year is $510.42 a month. The guide what is escrow explains how the servicer sizes that deposit and why it changes after a reassessment. The mortgage calculator and the home affordability calculator both take a yearly property tax figure, and using the post-sale estimate rather than the seller's bill is the safer input.
Property tax is also deductible on a federal return if you itemize: the IRS counts state and local real property taxes in the state and local tax deduction on Schedule A, while transfer taxes on a sale are not deductible. The guide SALT deduction 2026 covers the cap.
How to appeal an assessment
- Read the notice when it arrives. In Florida the property appraiser mails a Notice of Proposed Property Taxes, the TRIM notice, in August, and the appeal deadline counts from its mailing date.
- Check the facts on your property record: square footage, number of bathrooms, lot size, condition. A wrong fact is the easiest fix.
- Compare the value with recent sales of similar homes nearby. An appraisal from your own purchase or refinance is useful evidence.
- Talk to the assessor informally. Florida's Department of Revenue suggests requesting an informal conference with the property appraiser, but stresses that the filing deadlines do not change while you do.
- File the formal appeal in time. In Connecticut, appeals to the board of assessment appeals must be filed on or before February 20. In Florida, a value petition goes to the county value adjustment board within 25 days after the TRIM notice is mailed, the board may charge up to $50 to file, and for a value petition you must still pay at least 75 percent of the property taxes, plus any non-ad valorem assessments, before they become delinquent.
- Present your evidence at the hearing. In Florida you must give the property appraiser your evidence at least 15 days before the hearing, and if you disagree with the board's decision you may file a lawsuit in circuit court.
Deadlines and forms differ by state and even by town, so take the dates from your own notice. This guide uses Connecticut and Florida because their rules are published clearly; the formula is the same everywhere.
Frequently asked questions
What is a mill rate?
A tax rate expressed per thousand dollars of value. Connecticut's Office of Policy and Management puts it as $1.00 of tax for each $1,000 of assessment, and Florida's Department of Revenue uses the same definition for millage. A rate of 25 mills is therefore 2.5 percent of the assessed value, or $25 per $1,000.
Why is my assessed value lower than what my house is worth?
Often by design. Connecticut law requires towns to assess property at 70 percent of its value, so a $350,000 house carries a $245,000 assessment. Florida assesses at full market value but caps how fast a homestead's assessed value may rise. Other states use other ratios. What matters for the bill is the assessed value times the rate, not the assessed value alone.
Why is my property tax higher than the previous owner's?
Because a sale can reset the value. Florida's Department of Revenue says that when a property changes hands, the property appraiser removes the previous owner's exemptions and reassesses it at full market value as of the next January 1. A seller who held a capped homestead for years can pay far less than a buyer will. Other states have their own rules, so ask the local assessor before you buy.
Can I deduct property tax on my federal return?
Yes, if you itemize. The IRS lets you deduct state and local real property taxes on Schedule A as part of the state and local tax deduction, which is capped; transfer taxes on the sale of property are not deductible. The SALT deduction guide covers the 2026 limit and how it phases down at higher incomes.
How do I appeal my property assessment?
Check the notice for errors, compare your value with recent sales of similar homes, talk to the assessor informally, then file a formal appeal by the local deadline. In Connecticut the appeal to the board of assessment appeals is due on or before February 20. In Florida a value petition is due within 25 days after the TRIM notice is mailed, and talking to the appraiser does not extend that deadline.
Sources
- Connecticut General Statutes, chapter 203: section 12-62a (uniform assessment date of October 1; all property assessed at 70 percent of present true and actual value), section 12-62 (revaluation at least every five years), section 12-111 (appeal to the board of assessment appeals on or before February 20)
- Connecticut Office of Policy and Management: Mill Rates (a mill is $1.00 of tax for each $1,000 of assessment; assessment × mill rate ÷ 1,000; rates set locally; based on the grand list from two years prior)
- Florida Department of Revenue: A Florida Homeowner's Guide: Millage (one mill is $1 per $1,000; taxable value ÷ 1,000 × millage; multiple taxing authorities; the additional $25,000 homestead exemption does not apply to school taxes; Save Our Homes limit of 3 percent or CPI) (PDF)
- Florida Department of Revenue: Property Tax Information for First-Time Florida Homebuyers (just, assessed and taxable value; homestead exemption up to $50,000; reassessment to just value after a sale) (PDF)
- Florida Department of Revenue: Petitions to the Value Adjustment Board (informal conference; deadlines do not change while you talk to the appraiser; filing fee up to $50; petition within 25 days after the TRIM notice is mailed; partial payment requirement) (PDF)
- Miami-Dade County Property Appraiser: Homestead Exemption (first $25,000 applies to all taxing authorities, second $25,000 excludes school taxes; $50,722 for tax year 2025; apply by March 1; ownership and residence as of January 1)
- IRS Topic no. 503, Deductible taxes (state and local real property taxes deductible as an itemized deduction; transfer taxes not deductible)
General information based on the sources above, not tax, legal or financial advice.