Ad Valorem & Non Ad Valorem. What are They?

 

Summertime… it is time for staying cool in the pool, running through the sprinkler or having an ice cream cone. But in order to be refreshed in time for Truth in Millage (“TRIM”) notices and tax bills, I pose this question: “What are these ad valorem taxes and non ad valorem assessments? Are they one in the same? Here is the scoop . . .

Ad Valorem Taxes are taxes levied on real property and calculated using the property value and approved millage rates. A millage rate is one tenth of one percent, which equates to $1 in taxes for every $1,000 in home value. A number of different governmental authorities, including counties, municipalities, school boards, and special districts, can levy these ad valorem taxes. Florida Statute §200.001 provides a more detailed breakdown of the millage rate categories. The ad valorem taxes are based on a calendar year – January 1st to December 30th and are paid in arrears.

Non Ad Valorem Assessment is a charge or a fee, not a tax, to cover costs associated with providing specific services or benefits to a property. For example: waste collection and disposal, sewer, lighting, fire protection, or ambulance services. The non ad valorem assessment is measured based on a unit of measure determined by each levying governmental authority. Depending on the levying governmental authority, the non ad valorem assessment may be based on a fiscal year: October 1st to September 30th, or a calendar year: January 1 to December 31. These non ad valorem assessments are paid in advance.

Non Ad Valorem Assessments differ from Ad Valorem Property taxes because:
● Non Ad Valorem Assessments are based on project costs and benefits provided, rather than on property value and millage rate.
● Non Ad Valorem Assessments are assigned directly to the benefitting property, rather than to all properties in general in the taxing district.

Billing: Even though the non ad valoremassessment is not a tax, it is still included on the property tax bill. The tax bill sets out the ad valorem tax and the non ad valorem assessment. Both the ad valorem tax and the non ad valorem assessment are due November 1st of each year (in order to take advantage of the 4% discount – not the focus of this blog)

Authority for Ad Valorem Taxes: Article VII of the Florida Constitution and Chapters 192, 193, 194, 195, 196, 197, 200, and 201 of the Florida Statutes.

Authority for Non Ad Valorem: The Florida Constitution provides the power for the charter and non-charter counties, as well as the municipalities, to enact, implement, and enforce the measurement and service charges imposed on each individual.

So, take a few minutes to dive in and review the previous property tax bill or TRIM notice this summer. It makes for a cool summer read.

As always, should you have any questions on this or any other real estate topic we encourage you to reach out to your trusted local real estate attorney.

 

Anastasia M Stefanou, Esq. astefanou@berlinpatten.com

941-954-9991

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