American homeowners paid property taxes equal to 0.85% of their homes' value in 2024, according to the Tax Foundation's Facts and Figures 2026, which calculates effective rates from the Census Bureau's American Community Survey. The effective rate is total real estate taxes paid by owner-occupants divided by the total value of their homes, so it excludes taxes paid by businesses and landlords.

The state figures span almost a factor of six. Illinois had the highest effective rate at 1.79%, followed by New Jersey (1.68%), Vermont (1.40%), Nebraska (1.38%) and Connecticut (1.36%). Hawaii had the lowest at 0.31%, followed by Alabama (0.37%), Arizona and Idaho (0.43% each) and South Carolina (0.44%).

What those rates mean in dollars

Applied to a $400,000 home, the national effective rate works out to about $3,400 a year. The same home would carry about $7,160 at the Illinois rate, about $6,720 at New Jersey's, about $1,480 at Alabama's and about $1,240 at Hawaii's. Those are HomeLife Wave calculations from the Tax Foundation's statewide averages, and an actual bill depends on the local levy, the assessed value, the assessment ratio the jurisdiction uses and any exemptions.

The Tax Foundation's county tables, built from five-year Census estimates for 2024, show how far bills spread within states. The highest median property taxes paid were in Marin and Santa Clara counties in California, both above the table's $10,000 top code, followed by San Francisco ($9,862), San Mateo ($9,519), Connecticut's Western planning region ($9,295) and Lake County, Illinois ($8,923).

Collections per person

A second Tax Foundation table measures state and local property tax collections from all sources, homes and businesses, divided by population. In fiscal 2023 the national figure was $2,034 per person. New Jersey ($3,590), New York ($3,457) and New Hampshire ($3,439) were highest; Alabama ($769), Arkansas ($901) and Tennessee ($1,023) were lowest.

The federal deduction in 2026

Homeowners who itemize can deduct state and local real estate taxes on Schedule A, but only within the overall limit on state and local taxes, which also covers income or sales taxes. Under the 2025 tax law, that limit rose to $40,000 for 2025 ($20,000 for married couples filing separately), and the IRS lists it at $40,400 for 2026 ($20,200 filing separately).

The limit shrinks at higher incomes. For 2026 it is reduced when modified adjusted gross income exceeds $505,000 ($252,500 filing separately), and it cannot fall below $10,000 ($5,000 filing separately). The Schedule A worksheet for 2025 reduces the limit by 30% of the income above the threshold; at $550,000 of income in 2025, for instance, the limit falls from $40,000 to $25,000.

The deduction matters only to filers whose itemized deductions exceed the standard deduction, which for 2026 is $32,200 for married couples filing jointly and $16,100 for single filers, according to IRS Publication 505.

What counts as a deductible property tax

The IRS allows the deduction for taxes assessed uniformly on all property in the community for general public purposes. Not deductible: charges for specific services such as trash collection or water, assessments for improvements that raise a property's value (a new sidewalk, for example), transfer and stamp taxes, and homeowners association fees. When taxes are paid through a mortgage escrow account, only the amount the servicer actually paid to the taxing authority during the year counts. Taxes split between buyer and seller at a closing appear on the settlement statement.

Finding a local figure

A statewide rate is an average across counties, towns and school districts. The county or municipal assessor's office publishes the local tax rate, the assessed value of each parcel and the exemptions available, such as homestead, senior or veteran exemptions, along with the deadline for questioning an assessment, which varies by jurisdiction.

This article reports rules, data and expert guidance. It is not legal, tax, insurance or financial advice. Talk to a licensed pro, your tax advisor or your insurer before you act on it.

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