Business property assessments
DID YOU KNOW?
Owners of businesses located in King County are also required to pay taxes on personal property used in the operation of their business. This includes furniture, furnishings, machines, equipment, and tools, among other things.
Sole proprietors are eligible for a $15,000 Head of Household exemption, which is deducted from the business's total assessed value.
Commercial property is assessed each year at full market value, which is defined as the amount a buyer, willing but not obligated to buy, would pay to a seller willing but not obligated to sell.
The three methods used to determine real property value include:
|1.||Market: Sales comparisons|
|2.||Cost: Reproduction or replacement cost new, less accrued depreciation|
|3.||Income: Capitalization of market rents|
As with residential property, the valuation of commercial property is divided into land and improvements. We begin by establishing land value, which state law requires us to value as if it is vacant. This value is determined using the market approach, which analyzes sales of comparable bare land.
Our next step is to establish the value of the improvements (buildings, etc.). All three techniques are applied, if appropriate, in appraising improved commercial and industrial properties. While the cost and income approach are most often used, the appraisal method used will be the one that offers the best evidence of market value.
Whenever we revalue your property, you will receive an Official Property Value Notice showing your old and new total values with separate values shown for land and improvements.
Some real estate and/or personal property is exempt from property tax, based on its use or ownership. A detailed summary of exemptions is provided on pages 1-49 of this Department of Revenue report (.PDF, external link).
Owners of businesses located in King County are also required to pay taxes on personal property used in the operation of their business. For more information, click here.
Determining your property tax
The amount of property tax you pay depends on the cost of state and local government, including the operating costs of schools, roads, parks, libraries, hospitals, city and county government, and other taxing districts such as ports, fire districts, utility and sewer districts. A large part of each property tax dollar goes to pay off construction bonds for school buildings and other public projects.
Establishing tax levies
The state legislature sets statutory levy limits. In addition, voters approve excess levies to fund local projects or services, such as additional school levies, fire protection, sewerage treatment, etc.
To determine your tax rate, officials divide the total amount of money needed for your district by the total value of property in your district. Then, they add up all the levy rates of the various taxing districts in which your property is located. The assessed value of your property, multiplied by the combined rate, produces a tax amount which is your fair share of the total property tax levy in your area. The King County Treasurer issues tax statements and taxes are paid to the King County Treasury Operations.
For more detailed information on tax levies, click here.
If you have questions about how your property was valued, please contact us at 206-296-7300.