Property taxes are a type of "ad valorem" tax — the term is Latin for "according to value". Therefore, the tax amount is based, in part, on an assessment of your property’s value. Local property taxes fund schools, fire departments, and libraries, and they can be a major source of funding for your city or county. Johnston County's tax bill provides details on how your tax dollar is spent.
Real property value is determined by the appraisal division of the Tax Administrator's Office. County wide real property appraisals (revaluations) are required by North Carolina state law at least once every eight years. Johnston County's last revaluation was effective January 1, 2019. Property Owners were mailed a 2019 Notice of Assessed Value in January 2019. Unless you make additions and/or changes to your real property, the value will not change until the next scheduled revaluation on January 1, 2025.
The assessment is based on the tax office estimation of a property's market value. One of three ways is used to determine value:
Personal property value is valued every year as determined by the use of January 1st pricing guides. In some cases, the depreciation method or comparable pricing may be used.
Although the tax office makes an extreme effort to correctly value every property type, there are times when we may not have all the information needed to arrive at a true market value. North Carolina state statutes provide a way for taxpayers to appeal the value of their property when they feel it has been incorrectly assessed. For additional information visit the appeals section of our website.
The mailing of property tax bills usually generates some discussion on the difference in the tax amount from one year to the next as well as the reasons for change. Three separate components comprise the framework for the property tax---market values, budgets, and tax rates. Each part has its own function and is interrelated with the other parts.
What part does the market value play in the determining how much property tax I pay?
The tax office is required by North Carolina law to appraise all real property in Johnston County at market value at least once every eight years. This process is call revaluation. Personal property is appraised at market value each year as of January 1. The market value is used exclusively to determine every property owner’s share of the total property tax. The idea is that property with a higher market value should be responsible for a larger portion of the total tax than property with a substantially lower market value. The revaluation allows the tax department to equalize, or fairly spread the tax burden among all classes of property.
What part does the budget play in the determining how much property tax I pay?
All properties in Johnston County are located in at least two taxing districts--- the county, a city or fire district, and sometimes a special district. Each district decides how much money it will spend to provide services that are both requested by the public and required by law. This is the process of developing a budget. The income raised to meet these needs comes from several sources, including fees, state aids, grants, reserves, a sales tax, as well as the property tax. The amount of revenue that needs to be generated through the property tax is based upon each district’s total budget less anticipated income from all non-property tax sources.
"Budget" - "Non-Property Tax Revenue Sources" = "Amount of Property Tax Revenue Needed"
What part does the tax rate play in the determining how much property tax I play?
Once a tax district determines the amount of property tax revenue needed to fulfill their budgetary requirements, the next step is to set the tax rate. The tax rate is calculated by dividing the dollar amount of the property tax revenue needed by the total assessed value of all the property within the jurisdiction. The tax rate is applied to each property's assessed value to create individual tax bills. The resulting bill represents the property owner's proportionate responsibility in the overall tax liability.
"Amount of Property Tax Revenue Needed" / "Total Value of all Property" = "Tax Rate"
The property owner is responsible for full payment of property taxes. Property tax bills are not mailed to mortgage companies but rather to the property owner. If your mortgage includes an escrow account for payment of property taxes, it is your responsibility to verify that payment is received.
Mortgage companies access tax information online and retrieve the bills they need to pay. Most companies begin submitting payments in October and continue through December. The majority of lending companies contract with a tax service to handle the processing of payments. Please be advised that if your mortgage statement indicates the taxes have been disbursed and our system reflects an unpaid status, this generally means that it has been sent to a tax service, who will be submitting the payment.
An increase or decrease in the tax amount from one year to the next may change the amount escrowed by the mortgage company thereby changing the overall monthly mortgage payment.
The Johnston County Tax Administration Office would like to thank the large majority of taxpayers who pay their taxes on time. By paying timely, you avoid interest, costly fees, bank attachment, wage garnishment and the embarrassment of enforced collections.