Why did my taxes go up more than 3 percent?

Main Content

Video courtesy of Washington County

One of the most common inquiries from taxpayers is, "Why did my taxes go up more than 3 percent?"

There are four major reasons your property taxes can increase by more than 3 percent:

  1. If you live in a taxing district that has new voter-approved levies, your property taxes may increase more than the anticipated 3 percent. There are new levies approved or reauthorized by the voters that will be reflected in this year's tax bill.
  2. Prior to the assessment date of January 1st, if you made any major renovations or changes to your property, your property taxes may increase more than the anticipated 3 percent.

    The next two reasons are more complicated and require the definition of key terms to help understand the process:

    • Real Market Value (RMV) is the amount determined by the county assessor for a property that would sell in a typical open market transaction between a willing buyer and seller on January 1st of each year.
    • Maximum Assessed Value (MAV) is the taxable value limit established for each property and is typically allowed to increase each year by no more than 3 percent.
    • Assessed Value (AV) is the lesser of the RMV or the MAV. Taxes are calculated on the AV.
  3. Your AV may have increased more than 3 percent. Under Oregon law, your AV is the lesser of your RMV or your MAV. If your RMV has increased more than 3 percent, but is still less than your MAV, then the RMV increase is reflected in your AV.
  4. The last reason is due to compression. The operating taxes for schools and local government are limited. Each account is tested to determine if the operating taxes exceed the limit of $5 per $1,000 of RMV for schools and the $10.00 per $1,000 of RMV for local government. If the limit is reached, the tax bill is reduced (compressed). As the market value increases, the difference between the market and the assessed values may increase as well. This reduces the chance for compression but can also increase your tax liability if compared to a prior year's tax that was in compression. If your account has been in compression, it is possible that as the real market value increases, you will see an increase in your property tax bill by more than 3 percent.

The Assessment & Taxation office is available to answer further questions. Please call us at 503-655-8671 or email propertytaxinfo@clackamas.us.