RBC | Property tax notices for 2025 taxes, payable in 2026, were mailed last week, and many property owners are seeing higher bills. The increase is tied to two main changes: the end of a temporary tax break and new rules for how school funding is collected.
In 2022, lawmakers approved a temporary measure to soften sharp property tax increases statewide. Senate Bill 22-238 reduced taxable property values by $55,000 for residential properties and $30,000 for commercial properties in 2023 and 2024.
That reduction has now expired. For the 2025 tax year, properties are taxed at their full assessed value again, even if the property itself did not increase in value this year.
At the same time, a new school finance law (HB25-1320) has changed how much local school districts collect from property taxes.
Colorado pays for public schools using a mix of state funding and local property taxes, with the balance set each year by the Colorado General Assembly. Each district is required to raise a set amount to fund its schools. As the state reduces its share of school funding, districts must collect more through existing property taxes, even without voter approval. Although school taxes appear on local bills, the increases are largely driven by state funding formulas, not decisions made by local school boards.
In Colorado, property taxes are based on property value, assessment rates and local mill levies. Property values are set by county assessors using rules from the Colorado Division of Property Taxation. Values reset in odd-numbered years and are based on market data from an 18-month period that ended June 30 of the previous year.
How a property is valued depends on its type:
• Residential properties are valued using recent sales of similar homes, with adjustments for size, condition, location and other features.
• Commercial properties may be valued using income data, replacement costs or comparable sales.
• Agricultural land is valued based on its agricultural production, not market sales prices.
Once a property’s value is set, it is multiplied by an assessment rate to determine taxable value. Residential properties are assessed at a much lower rate than commercial properties.
That taxable value is then multiplied by local mill levies, which funds schools, counties, towns, fire districts, hospital districts, sanitation districts, recreation districts, water conservancy districts, pest control districts, cemetery districts, and libraries. One mill equals $1 in tax for every $1,000 of taxable value.
During reappraisal years, property owners receive a Notice of Valuation in the spring. Appeals must be filed during the appeal window listed on the notice and apply only to the property’s value, not the tax bill.
If an appeal is denied, property owners can request further review through the county Board of Equalization, the State Board of Assessment Appeals or district court.
Rising taxes do not always mean a dramatic increase in property value. Assessment rates, mill levies and state policy all play a role. New construction and major improvements can also affect values between reappraisal cycles.
Colorado also offers property tax exemptions for qualifying seniors and disabled veterans, which reduce taxable value.