What is the purpose of an equalization factor?

The equalization factor is primarily used to ensure fairness and equity in property taxation. Its main purpose is to multiply the assessed value of a property to achieve alignment in tax rates across different jurisdictions or localities. By applying the equalization factor, tax authorities can compensate for discrepancies in property assessments and ensure that properties are being taxed at a similar rate, even if they are located in areas with differing assessment practices. This helps create a more uniform system of property taxation, allowing for a more equitable distribution of tax responsibilities among property owners.

The other options, while related to real estate in some contexts, do not pertain to the specific function of the equalization factor. Zoning laws are established by local governments to dictate land-use regulations and have no direct connection to tax assessments. Employee contracts and property purchase agreements are involved in employment law and real estate transactions, respectively, but they do not relate to the equalization of property tax assessments.