A home is valued at $95,000. Property in its area is assessed at 35 percent of its value, and the local tax rate is $2.85 per $100. What is the amount of annual tax paid on the home?

A home is valued at $95,000. Property in its area is assessed at 35 percent of its value, and the local tax rate is $2.85 per $100. What is the amount of annual tax paid on the home?

• A. $947.63
• B. $949.00
• C. $940.00
• D. $960.00

Answer: (A)

Understanding how property tax is calculated: first determine the assessed value by applying the assessment percentage to the market value. Then apply the tax rate per $100 of that assessed value. Market value is 95,000 and the assessment percentage is 35%, so the assessed value is 95,000 × 0.35 = 33,250. The tax rate is $2.85 per $100 of assessed value. So divide the assessed value by 100 and multiply by 2.85: (33,250 ÷ 100) × 2.85 = 332.50 × 2.85 = 947.625, which rounds to $947.63. The annual tax paid is $947.63.

Understanding how property tax is calculated: first determine the assessed value by applying the assessment percentage to the market value. Then apply the tax rate per $100 of that assessed value.

Market value is 95,000 and the assessment percentage is 35%, so the assessed value is 95,000 × 0.35 = 33,250.

The tax rate is $2.85 per $100 of assessed value. So divide the assessed value by 100 and multiply by 2.85: (33,250 ÷ 100) × 2.85 = 332.50 × 2.85 = 947.625, which rounds to $947.63.

The annual tax paid is $947.63.