How Taxes are Levied in The State of Colorado

I found this information from a GRI course that I am taking through Vaned and thought it might be something useful to know and understand.

The following is an overview of how taxes are levied in Colorado. Some counties and municipalities may have slight variations in their approaches.

Notice of Valuation (May 1st)

  • Notice of Valuation sent to property owners by May 1st
  • Outlined the current recorded value of the property
  • This becomes the value which will be assessed to determine tax liability
  • Can be appealed if property owner feels it is inaccurate

Budget Hearings (September/October)

  • Determine an operating budget for the following year
  • Operating budget will determine tax revenues needed
  • Corresponding revenue increases must be within the limits set forth under Colorado law (unless otherwise approved through voter referendum)

Mill Levies (December)

  • Calculated based on required tax revenues and total assessed value for the county
  • One mill is equal to 1/1000 of a dollar.
  • This figure is added to other tax levies (i.e. school district) to determine the total mill levy and ultimately calculate property taxes
  • Example:
  • Step 1 to create Mill Levy for budget (divide):
    Required Tax Revenues = $1,500,000 divided by Total Assessed Value for the County = $100,000,000 (Revenues / Total Assessed Value)
    Mill Levy = 1.5% (or 15 Mills)
  • Step 2 Budget Mill rate added to other district taxes (add):
    Mill Levy (County tax) = 1.5% City Tax = .75% School District Tax = 4.25%
    Total Tax Rate = 6.5% (Total Mill Levy = 65)

Assessed Value

  • The percentage of a property’s actual value which represents its taxable value.
  • Residential assessment rate re-established every two years (on odd-numbered years)
  • Property tax is calculated by multiplying total mill levy by assessed value of the property.
  • Current assessment rate (for 2013-2014) is 9.13%
        To find the assessed value of a property, multiply

    Actual Value = $200,000 X Assessment Rate = 9.13%
    Assessed Value = $18,260

    To determine property taxes, multiply

    Assessed Value = $18,260 X Total Mill Levy = .065
    Property Taxes = $1186.90