Assessed Value
The value assigned to a property by a government assessor for the purpose of calculating property taxes, which may differ from market value.
How It Works
In many states, assessed value is a fraction of market value (e.g., 10% in Louisiana, 100% in California). Assessment ratios and revaluation schedules vary by state and even by county. Some states cap annual assessment increases (like California's Prop 13 at 2% per year), which can cause assessed values to diverge significantly from market values over time. Assessment accuracy is a major equity issue — systematic under- or over-assessment affects which taxpayers bear more or less of the tax burden.
Related Terms
- Property Tax — A tax levied on real estate (land and buildings) based on assessed value. Property taxes are the single largest revenue source for most U.S. city governments.
- Mill Rate (Millage Rate) — The property tax rate expressed as dollars per $1,000 of assessed property value. One mill equals $1 of tax per $1,000 of assessed value.
- Tax Levy — The total amount of property tax revenue a city authorizes to collect in a given year, calculated by applying the mill rate to the total assessed value of all taxable property.
About This Definition
This definition is part of the CitySpend Municipal Finance Glossary — 59 terms explaining how city governments fund and manage public services. All definitions are written in plain language for taxpayers, journalists, students, and municipal bond investors.