Many homeowners have seen the value of their homes rise dramatically over recent years. As a result, property taxes are generally trending upward too. You can’t always avoid a tax increase based on the higher value. However, if your new property tax bill is unreasonable in comparison to appreciation in your region, you might have grounds for an appeal. If your appeal is justified and determined to be sound, your property tax bill may go down. If you believe your property tax bill is too high, here’s what you need to know about appealing.
When You Can Appeal Your Property Tax Bill
Once you receive your new property tax bill, you only have a limited amount of time to appeal. Exactly how much time you get depends on your jurisdiction, so it can vary from one state or county to the next.
In most cases, you have 90 days to appeal after you receive the new assessment. However, some locations only give you 30 days, so it is best to act quickly.
If the appeals window closes, you will have to pay the amount on your property tax bill. Failing to do so comes with consequences. First, you’ll have penalties and fines for missing your payment. The government can also put a tax lien on your home. In the worst-case scenario, a tax lien can lead to a foreclosure.
Thoroughly Read Your Assessment Letter
Before you initiate an appeal, read your property tax bill carefully. Make sure the details about your property are accurate and take a look at the value assigned to your home and land. If there is an error in the property description, such as an incorrect lot size, the wrong number of bedrooms, or similar error, then that could lead to a high bill that is fairly easy to appeal.
Then, if you don’t spot a blatant error, look over the calculations that determined your property tax bill. How a jurisdiction assigns value for tax assessments differs from determining fair market value for home sales. In most cases, the math itself will be sound. However, it is always wise to learn how the numbers are calculated before you appeal.
Get the Lowdown on Neighboring Properties
You never want to appeal your property tax bill without having a reasonable case showing that it is too high. While appealing without just-cause won’t necessarily lead to a penalty, it does mean you could waste valuable time on a fruitless venture.
Often, the easiest way to make sure you have a decent case is to explore comparable nearby properties, or “comps,” as realtors call them. Research your neighborhood and identify nearby homes. Look for houses with similar features to yours, including the overall size, style, condition, and the number of rooms. Additionally, make sure you compare lot sizes as well, as differences in the amount of land can lead to dramatically different tax assessments.
Once you find a few comps, you need to look up the tax assessments on those properties. Usually, local governments maintain publicly accessible databases, making the information relatively easy to track down. Head to your local Tax Assessor’s Office or Land Records Office website to see if the database is available. If not, you may need to speak with a real estate agent or those neighbors to see if they will share the details.
If you discover that your property tax bill is higher than the comps, you may have a good case. However, even if theirs are similar, if you can demonstrate that those properties are better than yours, you may also be able to get your tax bill lowered.
Present Your Case to the Local Assessor
Once you have built your case, you’ll need to contact your local assessor. Usually, your property tax bill will have instructions on how to proceed with an appeal. However, if you need additional guidance, contact the assessor’s office to discuss the next steps.
Most appeals processes are incredibly formal. You need to follow them precisely if you want your appeal to move forward. Typically, you’ll need to complete a form and submit your evidence. Once complete, the review period can take several months. When they have rendered a decision, you’ll usually receive notification in writing.
Appealing the Decision
If the initial appeal didn’t go your way, you could opt to appeal that review. Usually, you’ll have to pay a small filing fee and submit a request to the appeals board. Then, you can challenge the decision and hope for a better outcome.
Appealing the review can be a lengthy process, especially in larger jurisdictions. In some cases, it may take a year to get a decision.
Risks of Appealing Your Property Tax Bill
Appealing your tax bill can come with risks. While the chance is fairly small, the assessor or appeals board could determine that your property assessment was too low, leaving you with an even higher tax bill.
At times, even if your bill is lowered, the amount is so small that it may not be worth the effort. Similarly, if the change is slight, you may come out financially behind if you paid more than your bill was lowered when you filed for an appeal.
Finally, if you intend to sell your home soon, a drop in the assessed value of your home could hurt you. You may get stuck with a lower sales price since the assessor or board reduced the value.
Have you ever had to appeal your property tax bill? Share your experience in the comments below.
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