Highest property taxes in America

November 25, 2013: 5:52 PM ET
property tax map 1
NEW YORK (CNNMoney)

If you don't want to grind your teeth at night over your property tax bill, steer clear of Manhattan's New York suburbs and those in northern New Jersey.

They're home to the three counties that charge the highest average property taxes in the country.

By contrast, a number of counties in Alabama and Louisiana have some of the lowest.

Those are among the findings of a new residential property tax study from the Tax Policy Center, which analyzed data from the American Community Survey.

Across the United States as a whole, between 2007 and 2011, 60% of counties reported average property tax burdens of between $500 and $1,500 a year.

That might cover one month's tax burden for many homeowners in one of the three most expensive counties: Westchester County, N.Y. ($9,647 a year); Nassau County, N.Y., ($9,080) and Bergen County, N.J. ($8,893).

Another five counties in New Jersey had average annual burdens topping $8,000.

By contrast, of the 24 counties nationwide with annual property taxes below $250 a year, nearly all were in Alabama and Louisiana, the study found.

In some states, property taxes are modest in dollar terms, but rank high when the tax burden is measured as a share of home price.

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Parts of Michigan, Nebraska, North Dakota and Ohio fall into this category. Their property taxes on average well exceed 1% of home prices, whereas in most counties in the nation, the average property taxes fall below the 1% mark.

Property taxes are some of the most opaque for taxpayers to figure out.

For one thing, there's no single formula that every county and state uses to calculate them.

In addition, the "assessed" value of your home on which your property taxes are based can bear little resemblance to your home's market value.

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And there's no telling from one year's assessment to another how high your bill will be. "[M]any localities set a revenue target to meet expenditure needs and then vary the tax rate to meet this target, conditional on the tax base," the study said.

No wonder, then, when asked by Gallup what they considered to be the least fair tax, the percent of Americans who chose the local property tax has nearly doubled, from 24% in 1988 to 42% in 2005.

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Of course, counties with higher property taxes tend to spend more on things like education and public services. They may also have higher priced homes. Or they may be higher simply because the local government isn't bringing in other major sources of revenue, like an income tax.

"In general, localities in states with high property tax burdens tend to have little or no other local taxes," the Tax Policy Center study noted.

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