Most buyers assume the property tax bill on the seller’s last statement is a reasonable stand-in for what they’ll owe after closing. In 14 of the 17 states this calculator covers, that’s roughly true — the taxable value carries over and only updates on a periodic county cycle, regardless of who owns the property. In three states — Florida, California, and Michigan — a sale itself resets the tax basis, and that reset can move your holding-cost number a lot from what the seller’s bill shows.
States where a sale resets the tax basis
Florida, California, and Michigan each specifically reset or uncap the taxable value at transfer, on top of (not instead of) their normal assessment cycle.
- Florida — Save Our Homes caps annual growth at 3%/yr once a property is homesteaded (10%/yr for non-homestead), but a sale wipes out that accumulated cap and the property reassesses to full just value.
- California — Proposition 13 resets the assessed value to your purchase price at closing, then caps growth at 2%/yr until the next sale.
- Michigan — Proposal A uncaps the prior owner’s taxable value on transfer and resets it to the State Equalized Value (roughly 50% of market value), then re-caps growth at the lesser of inflation or 5%/yr.
California and Michigan reset to different numbers using different formulas even though both are triggered by the same event — see our full Prop 13 vs. Proposal A comparison for the mechanics side by side.
States where a sale does not trigger reassessment
The other 14 states — Texas, New York, Illinois, Georgia, Arizona, Nevada, Washington, North Carolina, Tennessee, Ohio, New Jersey, Pennsylvania, Colorado, and Virginia — reassess on a periodic cycle set by the county or district, not on transfer. Closing on a property in these states doesn’t by itself change the assessed value.
That doesn’t mean the number never moves. Texas caps homestead appraisal growth at 10%/yr, Arizona caps Limited Property Value growth at 5%/yr, and Nevada caps growth at 3%/yr for owner-occupied property (8%/yr for everything else) — so those three still ease toward market value gradually, sale or no sale. Washington caps how fast a taxing district’s total levy can grow (about 1%/yr) rather than capping any individual assessment. The remaining states in this group — New York, Illinois, Georgia, North Carolina, Tennessee, Ohio, New Jersey, Pennsylvania, Colorado, and Virginia — have no statewide annual assessment-growth cap in this calculator’s baseline, so it’s the county’s next periodic revaluation, not your closing date, that eventually catches the value up.
| State | Resets basis at sale? | Annual assessment-growth cap (baseline) |
|---|---|---|
| Florida | Yes | 3%/yr homestead, 10%/yr non-homestead |
| California | Yes | 2%/yr |
| Michigan | Yes | Lesser of inflation or 5%/yr |
| Texas | No | 10%/yr (homestead appraisal cap) |
| Arizona | No | 5%/yr (Limited Property Value) |
| Nevada | No | 3%/yr owner-occupied, 8%/yr other |
| Washington | No | None on individual assessments (district levy growth capped ~1%/yr) |
| New York | No | None in this calculator’s baseline |
| Illinois | No | None in this calculator’s baseline |
| Georgia | No | None in this calculator’s baseline |
| North Carolina | No | None in this calculator’s baseline |
| Tennessee | No | None in this calculator’s baseline |
| Ohio | No | None in this calculator’s baseline |
| New Jersey | No | None in this calculator’s baseline |
| Pennsylvania | No | None in this calculator’s baseline |
| Colorado | No | None in this calculator’s baseline |
| Virginia | No | None in this calculator’s baseline |
The underwriting rule
Before you use a seller’s current property tax bill as your holding-cost estimate, check which column your state is in. In Florida, California, or Michigan, run the post-sale basis — full just value, purchase price, or State Equalized Value, respectively — through your numbers instead of the seller’s figure. In the other 14 states, the seller’s bill is a far more reliable starting point, though a capped annual increase or a pending county revaluation can still move it before your first bill arrives.
Why this matters more for some strategies than others
A flip in a reassess-at-sale state rarely holds long enough to feel the new basis directly — the buyer who takes the property off your hands is the one who inherits the reset bill — but it still matters for your resale pricing conversation, since a sharp-eyed buyer will run the same math. Buy-and-hold investors feel it immediately: your first full year of ownership in Florida, California, or Michigan can carry a materially higher tax bill than the number on the seller’s disclosure, and that has to be underwritten into cash flow from day one. In the 14 non-reassessing states, the seller’s basis effectively carries over to you until the next county cycle, which is a real (if temporary) advantage for buy-and-hold underwriting in those markets.