Alabama vs South Dakota
Property‑Tax Comparison: Alabama vs. South Dakota
Intro
Both Alabama and South Dakota levy property taxes that fund local services such as schools, roads, and public safety. According to the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates), Alabama’s effective property‑tax rate is considerably lower than South Dakota’s. The following sections present the key figures side‑by‑side, identify which state has the lower rate, and outline the types of taxpayers for whom the comparison may be most relevant.
Side‑by‑side Comparison
| Metric | Alabama | South Dakota |
|---|---|---|
| Effective property‑tax rate | 0.38 % | 1.09 % |
| Median home value | $195,100 | $236,800 |
| Median annual property tax | $738 | $2,590 |
| Property tax on a $250,000 home | $946 | $2,735 |
| Property tax on a $500,000 home | $1,892 | $5,469 |
| Median household income | $62,027 | $72,421 |
| Internal link (state tax page) | Alabama property tax | South Dakota property tax |
All figures are drawn from the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates).
Which State “Wins” on Property Taxes?
Alabama has the lower effective property‑tax rate (0.38 % vs. 1.09 %).
- Rate difference: 0.71 % points, which is a 65.4 % lower rate than South Dakota’s.
- Annual tax difference on a $250k home: $2,735 – $946 = $1,789.
- Annual tax difference on a $500k home: $5,469 – $1,892 = $3,577.
Based on the lower rate, Alabama yields less annual property‑tax liability for comparable home values.
Who Might Find This Comparison Most Useful?
| Audience | Relevance of the Comparison |
|---|---|
| Current homeowners | Understanding how their property‑tax burden compares to that in another state can inform decisions about relocating or refinancing. |
| Prospective homebuyers | Buyers evaluating affordability across states can use the tax figures alongside median home values and household incomes. |
| Retirees | Since many retirees consider overall cost of living, a lower property‑tax rate (as in Alabama) may reduce fixed‑income expenses. |
| Real‑estate investors | Investors assessing net‑operating income should factor in property‑tax differentials when projecting cash flow for properties in each state. |
| Policy analysts | The data provide a clear example of how state‑level tax structures vary, useful for comparative fiscal studies. |
Summary
- Alabama records the lower effective property‑tax rate (0.38 %) and lower median annual taxes ($738) compared with South Dakota (1.09 % rate, $2,590 median tax).
- The rate gap translates to a 65 % lower tax burden in Alabama, amounting to roughly $1,800–$3,600 less per year for homes valued at $250 k–$500 k.
- Stakeholders such as homeowners, retirees, and real‑estate investors can use these figures to evaluate the relative cost of owning property in the two states.
All calculations are derived directly from the Census Bureau’s 2023 ACS 5‑year estimates.
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Data Source
All figures are drawn from the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates). This comprehensive dataset provides reliable, standardized property tax information across all states.