Calculating a commercial property tax bill in Hartford

By , Hartford Business Journal | June 25, 2019

To calculate any property tax bill in Connecticut, an individual or business owner must multiply the assessed value of their property by a city’s or town’s mill rate and then divide by 1,000.

In the 1970s, Connecticut passed a law that required all cities and towns to adopt a 70-percent assessment ratio. That means to determine the assessed value of a property — whether it’s a single-family home, commercial office building or apartment complex — assessors multiply its market value by 70 percent.

Hartford is the only municipality allowed to have a lower assessment ratio — 35 percent — for single-family homes, so it’s highest-in-the-state 74.29 mill rate has a much bigger impact on commercial property owners. That high mill rate also gives neighboring towns a competitive advantage, at least in terms of attracting commercial development and investment.

For example, take a small office building with a market value of $450,000. If it was located in Hartford its annual tax bill would be $23,401. If it was located in West Hartford, which has a 41 mill rate, that same valued property would have an annual tax bill of $12,915. Property values, however, are much higher in West Hartford.

With a 35 percent assessment ratio, Hartford homeowners have an effective tax rate in line with surrounding communities.

For example, take a home located in Hartford with a market value of $250,000. Its annual tax bill would be about $6,500. In West Hartford, a $250,000 house has an annual property tax bill of $7,175. However, a lower assessment ratio hurts home values, and home values in West Hartford are much higher.