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Complete glossary lessonGeorgia-specific rule

Assessed value

Assessed value is the taxable value produced by applying the legal assessment ratio to fair market value before subtracting any exemption the problem or jurisdiction directs.

Official area

Finance and Closing

Knowledge cluster

Georgia taxes and closing math

Learning sequence

Define, distinguish, apply, retrieve

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Exam purpose

Recognize the rule, then reject the nearest look-alike.

Georgia lens

Apply the state distinction only when the facts call for it.

Connected terms

Connected to 4 terms and one official content area.

What does Assessed value mean in real estate?

Assessed value is the taxable value produced by applying the legal assessment ratio to fair market value before subtracting any exemption the problem or jurisdiction directs.

How is Assessed value different from the closest exam answer?

Fair market value represents full value. Assessed value is the statutory tax base. Taxable assessed value may be lower after exemptions.

What is the Georgia-specific rule?

Georgia generally uses 40 percent of fair market value. A $300,000 fair market value therefore produces $120,000 assessed value before exemptions.

Worked exam example

Scenario

A home valued at $425,000 is assessed at $170,000 because $425,000 × 0.40 = $170,000.

Decision rule

Fair market value represents full value. Assessed value is the statutory tax base. Taxable assessed value may be lower after exemptions.

What is the most common exam trap?

Trap correction

Do not subtract an exemption from fair market value unless the problem or governing rule specifically instructs that order.

Memory cue: Do not subtract an exemption from fair market value unless the problem or governing rule specifically instructs that order.

Original exam check

Apply the definition

Which statement correctly explains Assessed value?

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Related terms to learn next

Fair market value

Fair market value is the amount a knowledgeable, willing buyer and seller would agree upon in an arm's-length transaction when neither is compelled and both have reasonable exposure to the market.

Assessment ratio

The assessment ratio is the percentage of fair market value used to establish taxable assessed value.

Homestead exemption

A homestead exemption reduces the taxable value of a qualifying owner's principal residence for specified property-tax levies when the owner meets the applicable state and local eligibility and filing requirements.

Millage rate

A millage rate is a property-tax rate stated in mills, with one mill equal to $1 of tax for each $1,000 of taxable assessed value.

Recommended next complete lesson

Continue with Finance and Closing complete lesson. It places this term inside the full rule, worked examples, exam traps, and mixed practice required for mastery.
Previous termFair market valueNext term Ad valorem tax

Assessed value quick answers

Facts checked against the current PSI Candidate Information Bulletin and GREC sources. Editorial standards.

What is Assessed value?

Assessed value is the taxable value produced by applying the legal assessment ratio to fair market value before subtracting any exemption the problem or jurisdiction directs.

What is Assessed value commonly confused with?

Fair market value represents full value. Assessed value is the statutory tax base. Taxable assessed value may be lower after exemptions.

How does Georgia treat Assessed value?

Georgia generally uses 40 percent of fair market value. A $300,000 fair market value therefore produces $120,000 assessed value before exemptions.