April Showers Bring Tax Dollars
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It’s April 15th–tax day! But, no worries, you say. You are actually getting a refund this year. But think beyond the notorious April 15th, think, “April 30th,” the day to commemorate the other biggest tax bill you receive every year–your property taxes. April 30th is around the corner and one half of your property taxes are due.
Be sure and send this one off early because ignoring ( or simply forgetting) your state property tax can be an extremely expensive proposition. For example, let’s use the example of a $10,000 tax bill each year, which would make $5,000 due on April 30th and $5,000 due on October 31st. Now, just for grins, let’s say that you forgot to dig out that 2008 tax bill you received in February to pay your first $5,000 at the end of this month. Starting May 1st, Washington State assesses you an interest rate of 12% per year, computed at 1% per month for the entire tax bill of $10,000. In other words, you will pay $100 per month in interest for every month you are late in getting your taxes in.
But wait, there’s more fun ahead. Let’s say that you totally forgot about that April tax bill. If you go past June 1st, 2008 you will be assessed an additional 3% penalty on the entire $10,000 of property tax. By the time June 30th rolls around, you will owe a $300 penalty plus $200 of interest (for two months), or $500 total for being 60 days late. The King County Tax Assessor’s office will likely send you a delinquency notice after this June date (if you’re lucky), but if for some reason you miss that notice also and remain in ignorant bliss past December 1st, an additional 8% penalty will be applied to the original $10,000 amount. Your $10,000 tax bill has now grown to $1,100 in penalties and $800 interest for a grand total of $11,900!
So, if you happen to read this and find yourself thinking, ”Holy $%^%! I completely forgot about that April 30th property tax payment!” You owe me a latte!
