Property Tax in Oklahoma: Everything You Must Know As a Landlord or Property Manager

If you want to invest in Oklahoma real estate, we have great news for you: the property tax rates in this state are among the lowest in the country, making it a rather landlord-friendly area.

Even though the median property tax isn't too high compared to other states, you must keep in mind that you may get different rates depending on where you invested and which type of property you got.

Property taxes are the main source of revenue for many local governments and school districts, so you need to prepare and pay them in time if you want to avoid legal issues.

Here, we'll tell you everything you must know about Oklahoma property taxes, including when they're due, how you can pay them, and how much you can expect to pay every year.

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About Property Tax in Oklahoma

Property tax rates in Oklahoma work the same as in most other states. You'll pay a set amount based on the taxable value of your property (which can be based on market value) and your county's tax rate.

Even though county assessors will determine the market value of every property each year, increases are limited. Residential homestead and agricultural property, for example, has a cap of 3%, whereas any other real property has a 5% cap.

One of the benefits of property taxes in Oklahoma is that the rates tend to be stable. However, something you must consider is that properties that seem to have the same value could be appraised and taxed differently. This can be because of different assessment practices, exemptions, or other factors.

The median annual property tax payment in this state is $1,424, according to SmartAsset. This is much lower than the national median property tax payment of $2,795. If you're looking to save some money on property taxes, Oklahoma could be a great place to consider.

When Is Oklahoma Property Tax Due?

Every property in Oklahoma will get its assessed value by January 1st each year. Your local County Treasurer is responsible for mailing your bill by the end of November.

Once you receive your bill, you have 30 days to appeal it if you believe that your property was wrongly appraised.

What's great about Oklahoma is that it allows you to pay in two installments. The first half would be due on December 31st, and the second one would be due on March 31st. If you miss the December 31st deadline, your entire bill will become delinquent on the next day (January 1st).

What Happens If You Don't Pay on Time?

There are a few consequences of not paying your property taxes on time. First, your taxes will accrue interest. You may also get penalty fees.

If your payment remains delinquent for over three years, the County Treasurer can start an auction for your property in a "Tax Sale." The goal of the sale is to cover all the money you owe with the sale.

You can "redeem" your property by paying everything you owe before the treasurer executes the deed to the buyer. If the new owner already has the deed, you may not be able to do anything.

How to Pay Your Property Tax Bill in Oklahoma

Your property taxes should be paid to the county. This means that you must check your local regulations surrounding payments.

Usually, most counties will allow you to pay by mail or in person. However, other ones (like Oklahoma County and Tulsa County) may also allow you to pay by phone or online. You may choose whichever method feels more comfortable.

How Much Are Oklahoma Property Tax Rates?

Your Oklahoma property taxes will depend on different factors, primarily your assessment ratio and local tax rates. These rates, on the other hand, depend on each county's budgetary needs. In some cases, increases that exceed the state's cap are subject to voter approval.

Property tax rates (also called mills) are calculated with this formula: One mill = $1 per $1,000 of taxable value. You could look at the median property taxes and median home value in each county to evaluate which area fits your investment needs the best.

Oklahoma City, for example, has one of the highest effective tax rates in the state with 1.17%. It has a base millage rate of 11.45 mills. Canadian County is also on the expensive side with an average rate of 1.21%.

If you're looking for more affordable counties, you could consider Creek County or Payne County, which have average rates of 0.88% and 1.01%, respectively.

How Is Property Tax Calculated in Oklahoma?

First, you'll get your taxable value by multiplying your property's appraised value by the assessment ratio. You may be able to subtract exemptions if you're eligible. The assessment ratio can vary from 10% to 15%, depending on the county.

Once you get your taxable value, you must multiply it by your local tax rate.

If you live in Tulsa County, for example, and your assessed value is $100,000, you would have to multiply it by the assessed ratio, which is 11%. This gives you $11,000 in taxable value.

Now, you would have to multiply that by your millage rate. If the rate was 61 mills, you would use the following formula: $11,000 x 0.06 = $660.

In other words, you would have to pay about $660 that year in property taxes. Remember that this amount can vary according to different factors, including exemptions.

Is It Possible to Lower Your Oklahoma Property Taxes?

You can appeal your property tax bill if you don't agree with it. A local assessor would appraise your property again, which may get you a lower amount to pay for your Oklahoma property tax.

There are other options to lower your bill for property taxes, though. Depending on the case, you could even save hundreds of dollars in your taxes.

Exemptions

Exemptions are cases where, if you apply, you can take a particular amount off your property taxes. Those who are eligible for exemptions in Oklahoma are still responsible for paying their taxes when they're due.

You would need to check with your county to see if there are any exemptions you can apply to. However, the most common ones are outlined below.

Homestead Exemption

The homestead exemption is the most common one to find in Oklahoma. It can remove up to $1,000 of your assessed value from your annual tax bill.

You must own the property and have it as your primary residence as of January 1st of the year you're applying. If you're eligible, feel free to contact your County Assessor's Office and get the necessary application forms.

Senior Citizen Exemption (Senior Valuation Freeze)

Property owners who are 65 years old (or older) and meet particular income limit requirements could request a "valuation freeze." This prevents the property's value from increasing.

If you want to apply, your gross household income from last year can't exceed the current year's maximum income qualification. The amount for 2023 is $85,300. In other words, if you earn $85,300 or less, you are eligible.

Those who want to apply must own the property and occupy it as their primary residence as of January 1st.

Disabled Veteran Exemption

Permanently disabled veterans (and their surviving, unmarried spouses) can request an exemption from their property taxes. The veteran should have been honorably discharged. They must also be a resident of Oklahoma, and their disabilities must be related to their military service.

This exemption only applies to the veteran's primary residence.

Conclusion

Paying your tax bills on time ensures you avoid losing your property and other legal issues in the future. Thankfully, one of the main benefits of tax rates in Oklahoma is that they're considerably low compared to other areas in the country.

However, remember that your taxes can vary depending on the county and your property's taxable value. Take your time to review and pay your bills when they're due, and you can keep enjoying all the benefits that this state has for real estate investors.

If you're looking for more tips on property management accounting, check out our whitepaper on the best tips for simplifying this complex process.