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Assessment Glossary
Definitions
The terms listed below were compiled from the Wisconsin Department of Revenue (PDF) publications on property assessment and taxes.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
A
Appraiser
Generically, an appraiser is one who estimates value. Appraisers specialize in many areas, including mortgage financing, investment analysis, and insurance. These are typically designated as the purpose of the appraisal. Individuals who conduct appraisals that involve federally related transactions must be licensed or certified by the Wisconsin Department of Regulation and Licensing.
If an individual is engaged in the property assessment function for the purpose of taxation (see assessor), the individual must obtain certification from the Wisconsin Department of Revenue. The act of appraising property then is part of the assessment process. (Other parts include the administration of the exemption laws, filing summary reports, and providing information to the public.)
Apportion
Once the amount of taxes to be levied by each taxing jurisdiction has been determined, the total tax levy must be divided, or apportioned, among all the taxation districts which contain territory in the jurisdiction.
Arm’s-Length Sale
An arm's-length sale is a sale between two parties, neither of whom is related to or under abnormal pressure from the other.
Assessed Value
The dollar amount assigned to taxable real and personal property by the assessor for the purpose of taxation. Assessed value is estimated as of January 1 and will apply to the taxes levied at the end of that year. Assessed value is called a primary assessment because a levy is applied directly against it to determine the tax due. Accurate assessed values ensure fairness between properties within the taxing jurisdiction. (See equalized value for fairness between municipalities.)
Assessment Level
The assessment level is the relationship between the assessed value and the equalized value of nonmanufacturing property minus corrections for prior year over- or under-charges within a municipality-town, village, or city. For example, if the assessed value of all the property subject to property tax in the municipality is $2.7 million, and the equalized value (with no prior year corrections) in the municipality is $3 million, then the assessment level is said to be 90% ($2,700,000 / $3,000,000 = .90 or 90%).
Assessment Ratio
The assessment ratio is the relationship between the assessed value and the statutory valuation standard (fair market value for most property, use value for agricultural land, and 50% of full value for agricultural forest and undeveloped lands). For example, if the assessment of a parcel which sold for $150,000 (fair market value) was $140,000, the assessment ratio is said to be 93% (140,000 / 150,000 = .93). The difference in the assessment level and the assessment ratio is that the level typically refers to the taxation district; the ratio refers to the individual parcel.
Assessor
An assessor is the official responsible for appraising all property within an assessment district and signing an affidavit to its correctness. The assessor values all taxable property to determine the share of the levy that each parcel will bear. The assessor also determines which property is exempt from the property tax. To engage in property assessment work, the assessor must obtain certification from the Wisconsin Department of Revenue. The department keeps certification records on file and is authorized to inform an inquirer if an individual holds a valid credential.
In Wisconsin, manufacturing property is assessed by the Wisconsin Department of Revenue.
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C
Chattel
In law, any property other than a freehold or fee estate in land. Chattels are treated as personal property, although they are divisible into chattels real and chattels personal.
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E
Equalized Value
Equalized value is the estimated value of all taxable real and personal property in each taxation district, by class, as of January 1 and certified by the Department of Revenue on August 15 of each year. The value represents market value (most probable selling price), except for agricultural property, which is based on its use (ability to generate agricultural income), and agricultural forest and undeveloped lands, which are based on 50% of their full (fair market) value.
Excessive Assessment
An appeal to the municipality under Section 74.37 claiming a property assessment is excessive. The property owner files a claim against the municipality to recover the amount of property tax imposed as a result of the excessive assessment.
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F
Fair Market Value
Fair market value is synonymous with a property’s full value, market value or, in the case of personal property, true cash value. Fair market value is “the amount the property will sell for in an arm's-length transaction on the open market between a willing seller not obliged to sell the property and a willing buyer not obliged to purchase it.” -Waste Management v. Kenosha County Review Board 184 Wis. 2nd 541, (1994)
Full Value
(1) The value reflected as fair market value when used in reference to the valuation of real property under Section 70.32(1) Wisconsin Statue (this does not include agricultural property defined in Section 70.32 (2)(c)1 Wisconsin Statue). (2) The same as equalized value; however, is often used when referring to the value of school and special districts.
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L
Levy
Levy is the total amount of property taxes imposed by a taxing unit.
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M
Market Value
The dollar amount for which a property would be sold by a willing seller to a willing buyer under normal market conditions (see also, fair market value).
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R
Reassessment
This is the redoing of the existing assessment roll because of substantial inequities. All the property of the district is viewed, valued, and placed in the new assessment roll, which is then substituted for the original roll.
Revaluation
This is the determination of new values for an upcoming assessment year. The previous year’s assessment roll is not affected. The term is often used in conjunction with §70.055 of the Wisconsin Statutes where expert help can be hired to work with the assessor in revaluing the district.
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S
Statutory Value
The value of taxable property in a municipality at the value standard for each class as prescribed in Chapter 70, Wisconsin Statutes. Residential, commercial, manufacturing, forest, and other classes are assessed at fair market value. Personal property is assessed at its true cash value. Ag-forest and undeveloped classes are assessed at 50% of their full value. Agricultural land is assessed at its use value.
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T
Tax Rate
Tax rate is the ratio of the property tax levy to the base. The tax rate is determined by dividing the amount of the tax levy by either the total assessed value or the equalized value of the tax district. It is often expressed in terms of dollars per thousand. It is synonymous with the term levy rate.
Taxation District
A taxation district is a town, village, or city. If a city or village lies in more than one county, the taxation district is the portion of the city or village which lies within each county.
Taxation Jurisdiction
A taxation jurisdiction is an entity that is authorized by law to levy taxes on general property which is located within its boundaries. (see Section 74.01(7) Wisconsin Statue). In addition to towns, villages, and cities, this includes school districts, sewerage districts, and lake rehabilitation districts, for example.
True Cash Value
True cash value is the statutory reference to the fair market value of personal property.
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U
Unlawful Tax
An appeal to the municipality under Section 74.35 claiming a tax is unlawful because a clerical error was made in the description of the property or computation of the tax, the assessment included improvements which did not exist on the assessment date, the property was exempt from taxation, the property was not located in the municipality, a double assessment was made, or an arithmetic transposition or similar error has occurred.
Use Value
The value a specific property has for a specific use. Since 2000, agricultural land is assessed according to its use as farmland instead of its market value as indicated by sales.
Use Value Assessment
An assessment based on the value of property as it is currently used, not on its market value. This applies to agricultural land only.
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V
Value Standard
The basis for the methods used in estimating values for the equalized or assessed values. There are two basic values used in the process, the market value (full value for real property and true cash value for personal property), which is the basis for value of all property except agricultural land. The market value is based on the most probable selling price of the property. Agricultural land, as defined by administrative rule, is based on a valuation standard, which analyzes the ability to generate income as it is currently being used, hence use value.
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The terms listed below were compiled from the Wisconsin Department of Revenue (PDF) publications on property assessment and taxes.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
A
Appraiser
Generically, an appraiser is one who estimates value. Appraisers specialize in many areas, including mortgage financing, investment analysis, and insurance. These are typically designated as the purpose of the appraisal. Individuals who conduct appraisals that involve federally related transactions must be licensed or certified by the Wisconsin Department of Regulation and Licensing.
If an individual is engaged in the property assessment function for the purpose of taxation (see assessor), the individual must obtain certification from the Wisconsin Department of Revenue. The act of appraising property then is part of the assessment process. (Other parts include the administration of the exemption laws, filing summary reports, and providing information to the public.)
Apportion
Once the amount of taxes to be levied by each taxing jurisdiction has been determined, the total tax levy must be divided, or apportioned, among all the taxation districts which contain territory in the jurisdiction.
Arm’s-Length Sale
An arm's-length sale is a sale between two parties, neither of whom is related to or under abnormal pressure from the other.
Assessed Value
The dollar amount assigned to taxable real and personal property by the assessor for the purpose of taxation. Assessed value is estimated as of January 1 and will apply to the taxes levied at the end of that year. Assessed value is called a primary assessment because a levy is applied directly against it to determine the tax due. Accurate assessed values ensure fairness between properties within the taxing jurisdiction. (See equalized value for fairness between municipalities.)
Assessment Level
The assessment level is the relationship between the assessed value and the equalized value of nonmanufacturing property minus corrections for prior year over- or under-charges within a municipality-town, village, or city. For example, if the assessed value of all the property subject to property tax in the municipality is $2.7 million, and the equalized value (with no prior year corrections) in the municipality is $3 million, then the assessment level is said to be 90% ($2,700,000 / $3,000,000 = .90 or 90%).
Assessment Ratio
The assessment ratio is the relationship between the assessed value and the statutory valuation standard (fair market value for most property, use value for agricultural land, and 50% of full value for agricultural forest and undeveloped lands). For example, if the assessment of a parcel which sold for $150,000 (fair market value) was $140,000, the assessment ratio is said to be 93% (140,000 / 150,000 = .93). The difference in the assessment level and the assessment ratio is that the level typically refers to the taxation district; the ratio refers to the individual parcel.
Assessor
An assessor is the official responsible for appraising all property within an assessment district and signing an affidavit to its correctness. The assessor values all taxable property to determine the share of the levy that each parcel will bear. The assessor also determines which property is exempt from the property tax. To engage in property assessment work, the assessor must obtain certification from the Wisconsin Department of Revenue. The department keeps certification records on file and is authorized to inform an inquirer if an individual holds a valid credential.
In Wisconsin, manufacturing property is assessed by the Wisconsin Department of Revenue.
Back to Top
C
Chattel
In law, any property other than a freehold or fee estate in land. Chattels are treated as personal property, although they are divisible into chattels real and chattels personal.
Back to Top
E
Equalized Value
Equalized value is the estimated value of all taxable real and personal property in each taxation district, by class, as of January 1 and certified by the Department of Revenue on August 15 of each year. The value represents market value (most probable selling price), except for agricultural property, which is based on its use (ability to generate agricultural income), and agricultural forest and undeveloped lands, which are based on 50% of their full (fair market) value.
Excessive Assessment
An appeal to the municipality under Section 74.37 claiming a property assessment is excessive. The property owner files a claim against the municipality to recover the amount of property tax imposed as a result of the excessive assessment.
Back to Top
F
Fair Market Value
Fair market value is synonymous with a property’s full value, market value or, in the case of personal property, true cash value. Fair market value is “the amount the property will sell for in an arm's-length transaction on the open market between a willing seller not obliged to sell the property and a willing buyer not obliged to purchase it.” -Waste Management v. Kenosha County Review Board 184 Wis. 2nd 541, (1994)
Full Value
(1) The value reflected as fair market value when used in reference to the valuation of real property under Section 70.32(1) Wisconsin Statue (this does not include agricultural property defined in Section 70.32 (2)(c)1 Wisconsin Statue). (2) The same as equalized value; however, is often used when referring to the value of school and special districts.
Back to Top
L
Levy
Levy is the total amount of property taxes imposed by a taxing unit.
Back to Top
M
Market Value
The dollar amount for which a property would be sold by a willing seller to a willing buyer under normal market conditions (see also, fair market value).
Back to Top
R
Reassessment
This is the redoing of the existing assessment roll because of substantial inequities. All the property of the district is viewed, valued, and placed in the new assessment roll, which is then substituted for the original roll.
Revaluation
This is the determination of new values for an upcoming assessment year. The previous year’s assessment roll is not affected. The term is often used in conjunction with §70.055 of the Wisconsin Statutes where expert help can be hired to work with the assessor in revaluing the district.
Back to Top
S
Statutory Value
The value of taxable property in a municipality at the value standard for each class as prescribed in Chapter 70, Wisconsin Statutes. Residential, commercial, manufacturing, forest, and other classes are assessed at fair market value. Personal property is assessed at its true cash value. Ag-forest and undeveloped classes are assessed at 50% of their full value. Agricultural land is assessed at its use value.
Back to Top
T
Tax Rate
Tax rate is the ratio of the property tax levy to the base. The tax rate is determined by dividing the amount of the tax levy by either the total assessed value or the equalized value of the tax district. It is often expressed in terms of dollars per thousand. It is synonymous with the term levy rate.
Taxation District
A taxation district is a town, village, or city. If a city or village lies in more than one county, the taxation district is the portion of the city or village which lies within each county.
Taxation Jurisdiction
A taxation jurisdiction is an entity that is authorized by law to levy taxes on general property which is located within its boundaries. (see Section 74.01(7) Wisconsin Statue). In addition to towns, villages, and cities, this includes school districts, sewerage districts, and lake rehabilitation districts, for example.
True Cash Value
True cash value is the statutory reference to the fair market value of personal property.
Back to Top
U
Unlawful Tax
An appeal to the municipality under Section 74.35 claiming a tax is unlawful because a clerical error was made in the description of the property or computation of the tax, the assessment included improvements which did not exist on the assessment date, the property was exempt from taxation, the property was not located in the municipality, a double assessment was made, or an arithmetic transposition or similar error has occurred.
Use Value
The value a specific property has for a specific use. Since 2000, agricultural land is assessed according to its use as farmland instead of its market value as indicated by sales.
Use Value Assessment
An assessment based on the value of property as it is currently used, not on its market value. This applies to agricultural land only.
Back to Top
V
Value Standard
The basis for the methods used in estimating values for the equalized or assessed values. There are two basic values used in the process, the market value (full value for real property and true cash value for personal property), which is the basis for value of all property except agricultural land. The market value is based on the most probable selling price of the property. Agricultural land, as defined by administrative rule, is based on a valuation standard, which analyzes the ability to generate income as it is currently being used, hence use value.
Back to Top