Cut Taxes by Getting Your House Reassessed

Lower home prices are bad news for sellers -- but other homeowners may benefit from lower prices.

Your town or county government sets the property-tax rate based on the municipal budget. Officials divide the budget's needs by the total taxable property in the jurisdiction to generate the tax rate, or millage rate, levied against property owners.

The tax rate is often expressed as a dollar amount for every $1,000 of property value. For example, if the tax rate in your town is $16 per $1,000 of valuation and your home is valued at $300,000, your annual property tax bill will be $4,800.

How much property tax you pay therefore is a function of the value of your home. So -- in theory, at least -- a 10% reduction in your home's value could lead to a 10% reduction in your property taxes. ...