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Exploring the Current State of Property Tax Payments

People across the U.S. may disagree on the best style of pizza, or whether to call it soda or pop, but they’re fully united in their desire for simple, convenient property tax payments. And whether you’re a county, township, school district or even local sheriff, if you’re responsible for collecting property taxes, then you’re responsible for meeting these citizens’ expectations.

But what exactly are these expectations? And how can property tax collectors satisfy demands? New survey results give us unique insights into the current state of property tax payments, and how tax collectors can best respond.

First, it’s important to understand that taxpayers appreciate the role property taxes play in improving their quality of life. 46 percent feel they get a lot of value from property taxes paid, with 74 percent highlighting value from public safety (including fire and EMS services), 58 percent from roads and transportation and 54 percent from public schools. This satisfaction is likely to lead to more on-time payments – if your payments platform is geared to meet peoples’ preferences.

Preferred property tax payment channels

Given that homeowners tend to skew older, perhaps it’s no surprise that mail (33%) and in-person (28%) are the top two preferred payment channels when it comes to paying property taxes. Interestingly, more prefer to make tax payments through their bank’s website (14%) than through the government’s website (12%). This is unique in the world of bill payments, where most consumers typically prefer to pay using the biller’s site. The most likely explanation for this is that paying through the bank is simpler, with the government site less intuitive and less comfortable to use.

However, paying through the banks means slower collection times and more time spent processing checks and payments sent by the bank. Simplifying the online payments journey can help avoid all of this, reducing costs and staff time spent processing payments.

Preferred method to pay property taxes

Again, given that home ownership tends to skew toward an older demographic, it’s less surprising that 49 percent prefer to pay by paper check, with 21 percent choosing ACH withdrawal from their checking account. But, while these payment methods are currently most popular, digital payments are starting to emerge.

Today, only 1 percent prefer alternative payment methods, including PayPal and Zelle. This is likely to change — and quickly — as the proliferation of these payment methods for non-bill payments suggests a growing trend across all payments. State and local governments should get ahead of the trend and build platforms capable of processing these payment types. Younger payers especially are likely to strongly prefer these channels over others as this demographic grows to account for a larger proportion of those paying property taxes.

Conversely, 10 percent of citizens say their preferred payment method is not offered, and this can have several negative consequences, including late payments, increased call volumes and dissatisfied taxpayers. Each of these will impact day-to-day operations, making it essential for tax collectors to deploy a platform to which new payment methods can easily be added as needed.

Ultimately, tax collectors that offer convenient bill payment capabilities will be poised to ensure year-over-year on-time collections, reduced call times, increased staff efficiency and, of course, greater security and compliance. While traditional payment methods still reign supreme, the time is now to begin adding new payment methods to best accommodate the next generation of taxpayers.

Interested in learning more about how to simplify billing and payments for taxpayers? Explore how ACI supports government payments services.

*All stats courtesy: ACI Worldwide/YouGov Quick Survey, Feb 2021

Director, Product Marketing

Steve is a seasoned marketing professional with an extensive background in driving usage and adoption of financial products and services including credit cards, mobile/online bill payment, and card-based reward programs.