Property Tax 101

The property tax process begins with the assessment. Assessments are determined by the assessor of the local municipality. In some Dane County municipalities, these assessments are done annually. In other municipalities, particularly the smaller ones, they are done every few years. However, it would be unusual to not have a reevaluation every 4 to 7 years. The assessment represents the value of the property as of January 1 of a given year. After the assessment is completed (March or later, depending on whether a reevaluation is taking place), property owners are sent a notice of assessment, if their assessment value has changed. After receiving this notice, property owners have a limited period of time to discuss the assessment with the assessor and appeal to the Municipality's Board of Review. This is important because the property tax is calculated based on this assessment. After the period for appeal is passed, it would be too late for the property owner to appeal the amount of property tax. (NOTE: the notice of assessment will indicate value AND classification. In rural areas the classification can be important because of the different rate of assessment value placed on agricultural land, undeveloped land, and forestland.)


Wisconsin taxing districts (municipalities, schools, counties, etc.) set their budgets in the fall, usually November. After each district has set its levy for the next year, property taxes are calculated and bills are prepared. This means bills are usually received by the tax payer in early to mid-December. The deadline for making the first payment is the following January 31st.


Because of the deductability of property tax on owner's federal income taxes, many property owners pay all of the bill by December 31st. However, all that is required is that the first installment be paid by January 31st. The first installment is usually about one-half of the total due. For those who choose to pay in two installments, the second installment is due by July 31st. Property owners pay the first installment to their local municipality, but the second installment is paid directly to their county. All of this information (amount, due dates, who to pay, etc.) is stated on the bill sent in December.


For owners who miss a deadline and become delinquent the following occurs: If a property owner is late with the first installment, he or she loses the ability to pay in two installments. The full amount comes due immediately. In addition, in Dane County an interest charge of 1% and a penalty of 1/2 % of the principal is added to the total outstanding. This charge (1.5% total) is accrued on the first of each month until the bill is paid. If a property owner is late with the second installment, interest and penalty are charged from February 1st. This means that a late payment received anytime in August will be charged interest and penalty for 7 months (7 x 1.5% = 10.5%). Each month afterward the outstanding principal balance is charged another 1.5%. In determining whether a payment is timely, the treasurer's office goes by the postmark affixed by the US postal service.