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If you own a property in Louisiana, you are responsible for paying property taxes. Almost everyone is included in this, although there are some exemptions, and some mortgage companies take care of the payments if you are still paying yours off.
Property tax in Louisiana is low. In fact, the Pelican State has the fifth-lowest median property tax rate in the country, making it an advantageous area for landlords to manage investment properties.
Thanks to these low rates and generous exemption options for many property owners, you can enjoy living here without facing high bills every year.
Low Louisiana property taxes are great, but you still need to be prepared to pay your bills on time every year if you want to avoid penalties or the prospect of losing your home. It helps to understand how state property taxes work, how much they usually cost, and what responsibilities you have.
This guide offers an overview of everything you need to know about paying Louisiana property taxes and how they are calculated.
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An Overview of How Property Taxes Work in Louisiana
Louisiana property taxes work on an annual schedule and are overseen by the Louisiana Tax Commission. Rather than state-wide legislation and rates, property taxes are determined by property values and the local rate set by each parish or district.
Each area has its own system for collecting and can levy property taxes based on its budgetary requirements.
How Often Are Louisiana Property Taxes Due?
You will usually receive your property tax bill in early or mid-November. It needs to be paid by December 31st of the same year. However, payments made or postmarked by the 3rd of January do not incur charges for interest.
Partial payments are allowed, but penalties will apply if it is not paid in full before the close of the calendar year.
The Consequences of Paying Late
If your property tax bill is not paid by the close of business on December 31st, you are charged a penalty interest rate on any outstanding balance, which increases with each month passed.
Although the penalty is small, there may be other charges involved in your local area. You also face the risk of your property being put up for auction in a tax sale if taxes remain unpaid, meaning somebody else can pay your debt and own a portion of your home.
If the debt is high enough, they could eventually take complete ownership.
Luckily, you have some time to pay back all debts and reclaim your property, but you will have to cover the entire delinquent tax amount, all the accrued interest, and any other costs involved. You have three years from the date of sale to do this before the deed is handed over to the buyer.
How Can You Pay Property Taxes in Louisiana?
You can usually pay your Louisiana property taxes online to the Louisiana Department of Revenue, but some parishes ask you to send payment by mail. In some places, can pay in person at the relevant local office, often the Sheriff's Office.
Payment methods include card, check, and cash, but these may vary from district to district. Depending on what parish you live in, you may be allowed to pay your property tax in installments throughout the year, but this is not always an available option.
How Much are Property Tax Bills in Louisiana?
Property taxes are low for Louisiana residents across the board compared to most of the rest of the country, but some parishes are lower than others. It depends on the property tax rate they set and how much your property is worth.
Before we take a detailed look at how property taxes are calculated, let's look at the rates and average costs in some notable Louisiana parishes.
St. Tammany Parish
The highest property tax rate is in St. Tammany Parish, sitting at 0.89%, which is 0.10% less than the national average. Average property tax bills in the area are just below $2,000.
Orleans Parish
Orleans Parish has the second highest property taxes by percentage in Louisiana but is still low compared to the national average. The rate is 0.79%, meaning an average bill of just over $1,900.
East Baton Rouge Parish
East Baton Rouge Parish is home to the state capital and is the most populous parish in Louisiana. It has a tax rate of 0.72%. The average property tax bill here is between $1,135 and $1,450.
Concordia Parish
Concordia Parish has the lowest tax rate in Louisiana at 0.23%. The area's low property taxes mean bills of just $221 on average.
How Are Louisiana Property Tax Rates Determined?
The amount of property tax you pay depends on two main things:
- Your property's market value
- What tax rate is applied in your district
Calculations for property taxes in Louisiana are made based on the fair market value of your property and the amount of tax your parish has decided it needs to charge to meet its budget.
Property Value Assessments
Valuations are the first step in determining property taxes in Louisiana. Every parish has a designated assessor who is responsible for placing a value on every property in the area. This is usually done every year but must be done at least once every four years.
The market value of your property is based on what a genuine buyer would pay for it if they were to purchase it at that time. This is based on things such as the size, condition, and age of your property, how many rooms and bathrooms it has, the average sales prices of recently sold similar properties in your area, and any renovations or improvements made.
In Louisiana, property taxes are not based on the market value but on the assessed value. The assessed value is 10% of the fair market value, as dictated by state law. This means a property valued at $250,000 would be taxed based on $25,000.
What If I Disagree With the Valuation?
You can file an appeal request with the Parish Tax Authority in your area if you do not agree with the assessed value of your property. Procedures vary between parishes, so it is best to speak to your local authority for specifics.
Usually, the review board will look over the appeal request and make a decision on your case based on the information available. If you still don't agree with the decision after the review board finishes its assessment, you can then take it up with the Louisiana Tax Commission, but you have to do it quickly.
Millage Rate and Effective Property Tax Rate
There are two ways that property tax rates are expressed in Louisiana. It doesn't matter which one you use; the property tax amount you owe will be the same.
Millage rate
A millage rate is the main calculation used in Louisiana property taxes. It means the dollar amount charged as tax per $1,000 of a property's assessed value.
Say your home's market value is $150,000. Your assessed value would be $15,000. If your parish's millage rate is 50, then you would pay $750 in property taxes.
The calculation looks like this:
- $15,000 (assessed value) ÷ 1000 = $15
- $15 x 50 (mil rate) = $750
Effective Property Tax Rate
This is the more commonly seen way to express property tax in the US. It is the amount of tax owed as a percentage of a property's market value.
If the local effective tax rate in your parish is 0.5% and your property is valued at $200,000, your taxes owed would be $1,000.
Exemptions and Tax Rate Calculations
Some property owners in Louisiana qualify for exemptions on their property taxes. Although they still need to pay something, the amount may be significantly reduced if they qualify. We have shared more details below on the specific option, but overall, the exemptions apply as reductions to the taxable value of a property.
When calculating property tax rates, the exemption amount is deducted from the property's actual value before the millage or tax percentage is applied.
Here is an example of both.
Millage with Exemption Example
- Property Value $150,000 - Homestead Exemption of $75,000 = Taxable Value of $75,000
- Taxable Value of $75,000 x 10% = $7,500 Assessed Value
- $7,500 ÷ 1000 = $7.5
- $7.50 x Mil Rate 50 = $375
Effective Property Tax Rate with Exemption Example
- Property Value $200,000 - Homestead Exemption of $75,000 = Taxable Value of $125,000
- Taxable Value $125,000 x 0.5% Tax Rate = $625
How Can You Lower Your Property Tax Bill in Louisiana?
Although you cannot lower your property tax rate, you may be eligible to save money through Louisiana property tax exemptions.
All exemptions should be applied for through the local assessor's office in each parish.
Many property tax exemptions in Louisiana can help you save. Here are some examples.
Homestead Exemption
The Louisiana homestead exemption is one of the most generous in the nation, helping many homeowners save money on the bills and contributing to the state's status as one of the most affordable places to own property.
It applies to almost any person who owns a residential property in Louisiana and lives in it as their primary residence. If you own multiple properties, you can only apply for this exemption on one. You do not qualify if you are a property investor or landlord and do not actually live in the property you own.
If you are eligible, the homestead exemption can save you a lot of money. It makes the first $75,000 of your property's value untaxable. Say, for example, your property has an assessed value of $200,000. With the homestead exemption, you would only be taxed on $125,000.
Senior Citizen Exemption
Homeowners aged 65 or above with an income below the qualifying threshold can apply for a freeze on their property's value. This means it cannot be reassessed with a higher valuation (unless they make significant structural changes), even if the market changes and the real value increases.
Although it doesn't take anything off the property tax bill, it stops it from increasing significantly based on the property's assessed value.
Disabled Veteran Exemption
A veteran with a 100% service-connected disability is eligible for a tax exemption on the first $150,000 of their home's value. Because it is such a high exemption, some people end up paying almost nothing in property taxes if they qualify.
Of course, applications with proof of eligibility must be submitted.
Conclusion
Louisiana median property taxes are some of the most affordable in the country. Paying your bills on time keeps your property safe and your credit intact, and it pays to be organized and informed.
Property owners should stay up to date with local tax rates and property values to better prepare themselves for the following year's bill.
Remember- you can save a lot of money on taxes for your primary residence, so don't forget to apply if you think you are eligible!
If you're looking for more tips on property management accounting, check out our whitepaper on the best tips for simplifying this complex process.
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