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Taxes
Taxation is a significant part of school finance. Listed below are the various types of district taxes.
Property Tax
The property tax or real estate tax is a tax that is levied on the land and buildings owned by individuals and businesses. The base for the tax is the assessed value, which is established by the county assessment office. A uniform millage rate (tax rate) is annually established by the Board of School Directors to be levied against the value of each property. One mill is equivalent to $1 of tax for each $1,000 of property. Therefore, a property with an assessment of $100,000 (as established by the county) would pay $100 for each mill. The districts millage rate multiplied by the total assessed value for properties in the Lower Moreland Township School District produces the potential tax revenue for the district. For individual taxpayers the millage rate multiplied by the assessed value of their property produces the owners tax bill.
Interim Real Estate Tax
The interim real estate tax is a tax on assessed property that was not included in the original tax mailing of July 1. Interim real estate tax bills are sent out throughout the school year for new construction/remodeling that increased a propertys assessed value but was not included with the original tax mailing. The tax bill could be the result of an addition to a house/business, a swimming pool, a new house that is finished mid-year, etc.
Earned Income Tax
The district levies a 1% tax on the wages, salaries, commissions, net profits, and other compensation of individuals who reside in the district (income from interest and dividends in not included). The tax applies to employed individuals, unincorporated business owners, partnerships, etc., and is normally withheld from workers paychecks. Berkheimer Associates is the current contracted earned income tax collector for the district. Although the total earned income tax is 1%, it is equally shared with the municipalities the district realizes approximately one-half percent.
Real Estate Transfer Tax
The real estate transfer tax is imposed when someone sells an item of real estate. The tax is based on the selling price of the property and is paid by the purchaser at the time of transfer. The total transfer tax is 1% but the district and the municipality equally share it the district realizes one-half percent.
Delinquent Taxes
The district collects delinquent taxes from the real estate tax as well as the interim tax. All real estate tax bills dated July 1 that are not paid by December 31 are listed on a report completed by the local tax collector and turned over to the Portnoff Law Associates in mid January for collection. Portnoff Law Associates collects the tax and then remits it to the district as delinquent real estate tax.
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