Developing the Budget and Mill Rate
CALCULATING THE TAX RATE (MILL RATE)
Property is assessed in each town in Connecticut, as of the October 1st assessment day, based on 70% of the appraised value. There are two classes of property subject to taxation:
Property tax rates are expressed in mills, or thousandths of a dollar. For example, a property tax rate of 26.75 mills (.02675), when expressed in decimal fraction form) results in the payment of $26.75 for every $1,000 of taxable property's assessed value.
- Real Property - which includes land and improvements that are permanently attached to land
- Personal Property - is all property not classified as real property. It includes, but is not limited to, machinery, equipment, furniture, fixtures and Motor Vehicles. Personal property owned by ALL business enterprizes and certain property owned by residents (such as horses and unregistered snowmobiles, motor vehicles etc.) is taxable in Connecticut. See Personal Property Section.
Property tax payments are calculated by multiplying the net assessment by the mill rate.
APPRAISED VALUE X 70% SALES RATIO-EXEMPTION =NET ASSESSMENT X MILL RATE =TAXES
$600,000 x 70% $420,000 = $420,000 x .02675=$11,235 2014 GRAND LIST
$420,000 x .02600=$10,920.00 20015 GRAND LIST
The property tax rate is calculated after all other anticipated revenue has been deducted from the total projected budget for the upcoming year. The property tax rate, when multiplied by the net assessed value of all taxable property in the jurisdiction, will produce the revenue needed for all anticipated expenses, thus balancing the budget.
Two major tax categories that compose a town's total budget are general government and education.
Net Taxable Grand List is the total amount of property assessments on which taxes may be collected. It is the gross Grand List less exemptions and adjustment. Grand Levy is the amount of revenue that must be raised from property taxes. The property tax rate (mill rate) is determined by dividing the Grand Levy by the Net Taxable Grand List.
This process is expressed by the following formula:
Grand Levy/Net Taxable Grand List = Tax Rate
STEPS IN THE BUDGET MAKING PROCESS ARE:
1 Submission of proposed budgets;
2 Calculation of estimates income from all sources;
a. Expenses: All costs of government3 Review, revision and approval of proposed budget and other anticipated expenditures;
b. Income: All anticipated income from every source (federal and state grants, etc)
4 Determination of the Net Taxable Grand List (i.e. total of gross assessments of all taxable property less all applicable property tax exemptions); and
5 Calculate Mill Rate
Total approved budget $23,400,000
Less grants and miscellaneous income $2,000,000
Grand Levy (i.e balance needed from property taxes) $21,400,000
Grand Levy $21,400,000 divided by $800,000,000 (Net taxable Grand List)= .02675 (26.75 Mill Rate)
10 Main Street
New Milford, CT 06776
Phone: (860) 355-6070
Fax: (860) 355-3319
8:00 a.m. - 4:00 p.m.
Monday through Friday