PSI Oklahoma Real Estate Practice Test

How does a special assessment tax differ from other tax levies?

1. It applies to all property owners equally

2. Properties that receive no benefit do not pay the tax

3. It is a fixed rate determined annually

4. It is collected every month

The correct answer is: Properties that receive no benefit do not pay the tax

A special assessment tax is levied to fund specific improvements that directly benefit the properties being assessed, such as street repairs, sidewalks, or sewer systems. The key aspect here is that only those properties that receive the benefit from the improvements will be taxed. This differentiates special assessments from general taxes, which typically apply to all property owners within a municipality regardless of whether they directly benefit from the funded projects. In contrast, options related to applying equally to all properties or having a fixed rate do not accurately reflect the nature of special assessments. Monthly collection also does not specifically pertain to how special assessments are structured, as they can vary in their payment frequency. Thus, the distinctive feature of a special assessment tax is that only those properties receiving direct benefits from specific improvements are subject to the tax.