The Sunflower State is attractive to homeowners and real estate investors. Properties are relatively affordable, unemployment rates are low, and rental businesses are thriving. Additionally, Kansas is home to many natural wonders that residents and visitors can enjoy.
However, there are many more things that homeowners, property managers, and real estate businesses should be concerned about, including the ins and outs of property taxes in Kansas.
Do you know when you should pay your taxes? How many times a year should you do it? Are you looking for a way to reduce these expenses to maximize your real estate investment?
We've created a comprehensive guide to provide you with all the information you need. Read on!
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Understanding Different Types of Property Tax Bills in Kansas
In Kansas, city and county governments use property tax dollars to fund multiple projects and local services:
- Police protection
- Fire protection
- Public schools
On average, Kansas property owners pay about $2,445 in real estate taxes each year. The Kansas effective property tax rate is higher than in many states at 1.33% as well.
However, since the median home value in this state is $183,800, property tax payments are often below the national mark.
How Many Times Do You Pay Property Tax a Year in Kansas?
In Kansas, the County Treasurer is responsible for mailing tax bills, which is usually done by December 15. However, homeowners aren't always required to pay taxes on an annual basis. Instead, they can do this twice a year.
- First installment: At least half of the tax amount is due by December 20 after the county treasurer mails the bill.
- Second installment: The second half is due by May 10 of the coming year.
Sometimes, homeowners can pay the full amount of taxes due before December 15 (the date of the first installment).
Also, the process is slightly different if you have a mortgage loan on your property. In this case, you'll receive a statement with all the tax information.
The County Treasurer will send your tax bill to the mortgage company or bank. After that, your taxes will be paid with funds from your escrow account.
Consequences of Late Payments
What happens if you make late payments? Paying your property taxes on time is crucial to avoid penalties and additional charges.
To help you understand what could happen if you don't pay your property taxes as requested, here's an outline of the consequences of missing deadlines.
Kansas penalizes people who pay their taxes after the due date. Usually there is a penalty computed at a certain rate according to the amount of tax due, but those interest rates change annually. You should contact your County Treasurer if you have a question about current rates.
Overdue tax amounts can also become liens on property, which act as collateral for debts.
However, homeowners have some time to pay their taxes before this happens according to the rules mentioned above.
If you don't pay your delinquent tax amounts, you could lose your home. The county is authorized to foreclose and sell your home at a public auction.
Properties with delinquent taxes of 3.5 years or more can be sold to the highest bidder. When a home is bid off, the sale price usually covers the delinquent tax balance and legal charges due.
However, property owners are informed about a potential tax sale. The County Treasurer prepares a list of all properties subject to auction between July 1 and July 10 each year. It's submitted to a newspaper on or before August 1.
In addition, the treasurer is legally required to publish this notice at least once a week every three weeks before the sale and post a copy of this document in their offices. It has to be in a conspicuous place.
After that, the tax sale is often held on or after the first Tuesday of September as long as the notice has been published.
Can Homeowners Redeem Their Properties After a Tax Sale?
Kansas residents have the right to redeem their property after a tax sale if they pay the past-due tax balance. Homeowners have one to three years to do this, depending on their particular situation.
These are the three redemption options:
- General redemption period: Two years after the county acquires the property
- Redemption period for homestead properties: Three years after the sale
- Redemption period for abandoned properties: One year after the sale
How to Pay a Property Tax Bill in Kansas
There are many ways to pay your Kansas tax bills, but payments are handled through the County Treasurer's Association website.
Also, you can make payments through your desktop or mobile device with the Kansas Property Tax Payment application.
How Much is Property Tax in Kansas?
In Kansas, the assessment rate on residential properties is 11.5%. There's also a statewide assessment rate for commercial and industrial properties. It's 25%.
However, property taxes vary due to several factors:
- The fair market value of your home
- The assessment rate
- The mill levy
How Is Property Tax Calculated in Kansas?
A county appraiser must list and determine the assessed value your property fairly and uniformly, estimating only its value. The county appraiser should mail this information by March 1 as a "notice of value."
However, assessed value isn't the only consideration for property taxes. In addition to assessed value, the amount you should pay also depends on the budgets your city and county governments set each year as well as other factors like the mill levy.
Essentially, you should do the following to calculate your property taxes:
- Determine the appraised value of your home, which is set in your notice of value
- Multiply the appraised value by 11.5%, which is the statewide assessment percentage for residential properties
- Multiply the assessed value by the mill levy, which is the tax rate applied to this sum
- Divide that amount by 1,000 to estimate the property tax you owe
However, the first $20,000 in your property's appraised value is exempt from the 20-mill statewide portion of the mill levy, which may reduce your tax bill.
If you want to know your mill levy or have more questions about this process, don't hesitate to contact your county clerk or appraiser's office.
How Can I Lower My Property Taxes in Kansas?
Although property taxes aren't so high in Kansas, lowering these costs can help you reduce your financial burden. Fortunately, there are several alternatives in this state.
Property owners can reduce real estate taxes through several relief programs administered by the Kansas Department of Revenue. Both offer a refund to eligible taxpayers. These are:
- Homestead Property Tax Refund
- Senior or Disabled Veteran (SVR) Property Tax Refund
- SAFESR Property Tax Relief
- Refund Advancement Program (optional)
Homeowners can also appeal the notice of value within 30 days of the mailing date if they believe the estimated property value is too high.
If you want to have the value of your home reviewed, you can also file a payment under protest form with your County Treasurer when you pay your taxes.
In addition, several tax exemptions can help you reduce these costs, including the following:
- Personal Exemptions
- Military Exemptions
- Farm Exemptions
- Business Exemptions
- County Appraiser Authorized Exemptions
- Nonprofit: Religious, Education, and Charitable; Humanitarian Purposes
- Nonprofit Fees Charged for Services
Important Propositions for Real Estate Investors in Kansas
In Kansas, lawmakers have voted to pass propositions with property tax purposes. This information can help you make wise payment decisions and improve your tax strategy.
This year, they adopted a property tax break for child care, restaurant, and fitness club businesses. In addition, a proposed amendment to the Kansas Constitution, the SCR 1610, limits tax valuation increases to 3% each year.
There's also the KS HB2239, which provides increased deductions and a property tax freeze for senior residents.
It also introduces a SALT Parity Act to align the Tax Cuts and Jobs Act with the state's tax code.
Buying a Kansas property is definitely an attractive idea. However, you should understand your tax duties and responsibilities to make sure your finances are in order.
In addition to learning how to calculate your tax bills, it's important to keep up to date with new legislation to make informed decisions about your tax strategy.
If you have doubts or questions, remember that a seasoned tax professional can provide the guidance you need.
If you're looking for more tips on property management accounting, check out our whitepaper on the best tips for simplifying this complex process.