Taxes in Chapel Hill
Chapel Hill's property tax picture combines precisely sourced nominal rates -- Orange County's own rate, the Town of Chapel Hill's own rate, and a downtown service district supplement -- with a separately cited 'effective rate' figure that runs notably higher, a real disclosed gap rather than a reconciled single number. Beyond property tax, residents get North Carolina's flat, falling state income tax.
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Learn moreOrange County's rate: a real, current increase
Orange County's property tax rate for fiscal year 2026-27 was set at 68.05 cents per $100 of assessed value, 4.22 cents above the previous fiscal year, per the Orange County Board of Commissioners' own FY2026-27 budget approval. A separate aggregator source cites Orange County's overall effective rate at 0.96%, with a median bill of $4,105 on a $428,500 home -- broadly consistent with, though not identical to, the nominal county-only rate.
Town of Chapel Hill's own rate, plus a downtown service district supplement
The Town of Chapel Hill's own property tax rate for the 2025-2026 service year is 50.0 cents per $100 of taxable value. Property owners within the downtown Chapel Hill service district -- which receives supplemental municipal services -- pay an additional 5.5 cents per $100 on top of that, for the service year starting July 1, 2025. Combining Orange County's 68.05 cents and the town's 50.0 cents gives a nominal combined rate of roughly 1.1805% of assessed value for a non-downtown Chapel Hill property (before any Chapel Hill-Carrboro City Schools or other special-district levies), or roughly 1.2355% within the downtown service district.
A separately cited, higher "effective rate" figure -- a real, disclosed gap
One source cites Chapel Hill's median effective property tax rate at 1.71% -- notably higher than the North Carolina state median of 0.81% and the national median of 1.02%, and higher than the roughly 1.18%-1.24% combined nominal rate calculated above from the county and town rates. That same source cites specific tax bills ranging from $5,409 (ZIP 27517) to $6,748 (ZIP 27514), attributing the ZIP-level variance primarily to differences in school-district levies and local assessment districts -- meaning Chapel Hill-Carrboro City Schools' own tax layer and other special-district charges likely account for the gap between the nominal county+town rate and this higher effective-rate figure, though that specific reconciliation was not independently confirmed this session and is disclosed as a real, open gap rather than resolved.
State-level taxes: North Carolina's falling flat income tax
As in Cary, North Carolina's flat personal income tax rate fell to 3.99% for 2026 (from 4.25% in 2025 and 4.5% in 2024), with a possible further reduction to 3.49% in 2027 if state revenue targets are met -- Social Security benefits are not taxed. Orange County's combined sales tax rate runs 7.5% (the state's 4.75% rate, plus a 2.25% county rate and a 0.5% special district rate) -- notably higher than the 6.75%-7.3% range cited for Wake County/Cary.
Key takeaways
- Orange County's property tax rate is 68.05 cents per $100 of assessed value for FY2026-27, a 4.22-cent increase; a separate aggregator cites a 0.96% overall effective rate with a $4,105 median bill on a $428,500 home.
- The Town of Chapel Hill's own rate is 50.0 cents per $100 for the 2025-26 service year, plus an additional 5.5 cents/$100 for properties in the downtown service district -- combining with the county rate to roughly 1.18%-1.24% of assessed value nominally.
- A separate source cites Chapel Hill's median effective property tax rate at a notably higher 1.71% (bills ranging $5,409-$6,748 by ZIP code, attributed mainly to school-district and special-district levies) -- a real, disclosed gap above the ~1.18%-1.24% nominal county+town rate, not fully reconciled this session.
- North Carolina's flat state income tax fell to 3.99% for 2026 (possibly 3.49% in 2027); Social Security isn't taxed. Orange County's combined sales tax rate is 7.5% -- notably higher than Wake County/Cary's 6.75%-7.3%.
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