Understanding Property Taxes in Colorado

Introduction

Property tax revenue supports public schools, county governments, special districts, municipal governments, and junior colleges.  All of the revenue generated by property taxes stays within your county.  Property taxes do not fund any state services.

The county assessor is responsible for discovering, listing, classifying, and valuing all property in the county in accordance with state laws.  The assessor’s goal is to establish accurate values of all property located within the county, which in turn ensures that the tax burden is distributed fairly and equitably among all property owners.

Real property is revalued every odd-numbered year.  Personal property is revalued every year.  Property tax calculations consist of several components:

• property classification
• actual value of the property
• assessment rate
• assessed value
• tax rate

Property Classification

Property is classified according to its actual use on January 1.  The property’s classification determines the rate at which the property will be assessed.

Actual Value of the Property

Residential property is valued using only the market approach to value.  In this approach, the value of the subject property is based on an analysis of comparable sales.  For tax years 2011 and 2012, the comparable properties must have sold between January 1, 2009 and June 30, 2010.  However, if insufficient data existed during that time frame, data from each preceding six-month period (up to a period of five years preceding June 30, 2010) may be utilized.

Most non-residential property, including personal property, is a valued by consideration of the market approach, the cost approach, and the income approach to value.  Please refer to the brochure entitled “Property Valuation and Taxation for Business and Industry in Colorado” for additional information regarding non-residential property.

Assessment Rate

For property that is classified residential, the current assessment rate is 7.96% of market value.  The assessment rate for most other types of property, including personal property, is 29% of actual value.

Assessed Value

Multiplying the actual value by the appropriate assessment rate results in what is known as the property’s “assessed value”.

Each year county commissioners, city councils, school boards, and governing boards of special districts determine the revenue needed and allowed under the law to provide services for the following year.

Each political subdivision calculates a tax rate based on the revenue needed from property tax and the total assessed value of real and personal property located within the political subdivision’s boundaries.

All of the tax rates of the various taxing entities providing services in your tax area are added together to from the total tax rate

Public notices of budget hearings are published in the local newspaper.  The public hearings are usually scheduled in September or October.  By attending  budget hearings, taxpayers may participate in the budget process and become informed about the quality and cost of services provided in their area.

The assessor classifies and values property.  The various taxing entities determine tax rates.

Notice of Valuation

Real Property Notices of Valuation are mailed by May 1 of each year.  Personal Property Notices of Valuation are mailed by June 15 of each year.  The notices list the location, classification, the characteristics germane to value, and the actual value of the property for both the prior and current years.

The Hinsdale County Assessor may be reached at 970-944-2224.

(Please note that the above information was taken from a brochure prepared by the Division of Property Taxation Department of Local Affairs of the State of Colorado.  For additional information please visit www.dola.colorado.gov/dpt.)