Property Tax
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A tax levied by local governments on real estate and, in some jurisdictions, personal property, based on the assessed value of the property.
## Property Tax
Property tax is a local tax on real estate (land and structures) that funds schools, roads, police, fire departments, and other municipal services. It is a significant household expense that affects disposable income.
### How It's Calculated
```
Annual Property Tax = Assessed Value × Tax Rate (mill rate)
```
### US Averages by State
| State | Effective Rate | Annual Tax on $350K Home |
|-------|---------------|-------------------------|
| New Jersey | 2.23% | $7,805 |
| Illinois | 2.08% | $7,280 |
| Texas | 1.60% | $5,600 |
| California | 0.71% | $2,485 |
| Hawaii | 0.27% | $945 |
### Impact on Salary Decisions
Property taxes vary dramatically by location and significantly affect the true cost of living. A high salary in a high-property-tax area may provide less housing value than a moderate salary elsewhere.