Chapters

00:00 Introduction to Property and Car Taxes

00:17 Understanding Car Taxes in Mississippi

02:22 The Impact of Home Reassessments

04:41 Actionable Steps to Manage Your Taxes

05:10 Upcoming Retirement Series Teaser

Transcript

Hi everyone, I'm Ryan Earley, host of the PERS Pro YouTube channel. Today, we're breaking down why property taxes might jump, why your car taxes might fall, and most importantly, what you as a PERS member can do to keep more of your hard-earned money. Let's get started.

Let's start with car tags. In Mississippi, your tag isn't just a flat fee. It includes several fees, including an ad valorem tax, which is essentially a property tax on your vehicle. According to the Mississippi Department of Revenue, this tax is based on the assessed value of your vehicle and the local millage rate of where you live. The Department of Revenue establishes the value of your vehicle based in part on the manufacturer's suggested retail price, or MSRP for short. To account for wear and tear, they apply a depreciation factor according to an annually adopted schedule. If the millage rates in your city and county remain constant, and that is a big if, the amount of tax you pay should go down every year. This is because as the vehicle depreciates each year, the assessed value also drops each year.

Let's look at an example. Let's assume you buy a new vehicle with a MSRP of $40,000 in a local district with a combined millage rate of 120 mills. For this example, we'll assume a depreciation cycle with selected years as shown in the table. You can see in the first year you buy the vehicle, you'll pay close to $1,300 in ad valorem taxes. In year five, that drops to less than $600. And by year 10, it's close to $100. This is why the age of the car can matter more than the market value of the car. As an extreme example, an 11-year-old luxury car that was worth $100,000 brand new but is now worth $25,000, would only pay $100 in ad valorem taxes. Meanwhile, a brand new entry-level car that costs $25,000 today could result in the owner paying close to $1,000 in ad valorem taxes in the first year.

Now let's talk about your home. Real property tax is calculated similarly, but the assessment ratio is lower, 10 % for owner-occupied residential homes. Under Mississippi law, counties must reassess property at least once every four years. Why does this matter? Because real estate values have moved significantly higher recently. According to Redfin and Zillow market data, over the past 12 months, Mississippi home prices have risen by 3.9 % and this is as of late 2025. And over the past four years, in many high growth areas of the state, home appreciation has approached or even exceeded 15 to 20 % since 2022. I know personally that these numbers track with what I've experienced locally.

Let's look at an example. If your home's true value was $250,000 four years ago, and it is reassessed in 2026 at a 20 % increase, meaning the home is now assessed at $300,000, here's the impact if your millage rate remained constant at 120 mills. Your old tax bill would be $3,000. Your new tax bill would be $3,600. That is a $600 annual increase simply because the market value of your home went up.

So, how do we fight back? Here are your action items you can take.

One, check your taxing district. If you've recently moved, ensure your car is registered in the correct district. Some neighboring districts have millage rates that differ by 20 or 30 mills. This impacted me several years ago, but luckily I caught it.

Two, buy for age, not just price. If you are shopping for a vehicle, understand that a slightly older car saves you significantly more on taxes than a new one in the same price range.

Three, challenge your reassessment. If you receive a notice that your home value has increased and you believe it is overvalued, you have a legal window, usually in July or August, to challenge that appraisal with your local board of supervisors and tax assessor's office.

Remember our video on financial resolutions for PERS members video 15? Don't let these savings vanish. If you save money on your car tag or win a property tax appeal, consider redirecting that money into your emergency fund, college savings, health savings, or deferred comp. I hope this video helps you prepare for any potential increases or decreases in your property taxes or car tags in 2026.

Next week, we're starting a brand new retirement series that will span several weeks that I'm really excited about. We'll be covering everything you need to know about leaving the workforce, when to retire from PERS, which benefit option to select, what beneficiaries to name, your healthcare options, and the best time to draw social security or funds from your IRAs, 457s and 403-plans. Please make sure you subscribe so you don't miss those upcoming videos. If you found this video helpful, can thank me by hitting the thumbs up button and sharing it with other PERS members. If you have a follow-up question about PERS or anything else related to personal finance, please visit our website at perspro.ms and submit your question or topic for a future episode. Thank you for your valuable public service to the state of Mississippi. We'll see you next time.

Disclaimer, this video is for educational and informational purposes only. Neither the host nor this YouTube channel are officially affiliated with, endorsed by, or sponsored by the Public Employees Retirement System of Mississippi. Always consult a qualified professional for personal advice specific to your situation.