What is the difference between the assessed value and the actual value?

Assessed value and actual value are terms used to describe the value of a property for tax purposes in Texas. The assessed value is the amount of the property tax that the owner of a property owes to the municipality. This amount is determined by the local tax assessment office and is based on the estimated market value of the property, such as the home or land. The actual value, on the other hand, is the agreed-upon price a buyer and seller agree upon for the sale of a property. The difference between the two values lies in the fact that the assessed value is used to determine how much tax a property owner owes while the actual value is used to figure out how much money the seller receives from the sale of the property. For example, if the estimated market value of a house is $400,000, the assessed value would be based off of this number. The assessed value would then be set at around $200,000 to compute the total taxes owed. However, if the two parties involved in the sale of the house agree upon a price of $350,000, then the actual value of the sale would be $350,000. In other words, the difference between the assessed value and the actual value is that the assessed value is used to determine the taxes due on a property while the actual value is the agreed-upon sale price for the property.

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What is the difference between the assessed value and the actual value?

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