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Property Tax Appeal - Challenge your property tax appraisal and save

Posted In:  taxes

property tax appraisalUp to 60% of taxable property in the U.S. is assessed at a value that's higher than it should be, according to the National Taxpayer's Union, an advocacy group from Washington, D.C. with a goal to lower taxes. And that means the property is taxed at a higher rate as well

Additionally, the American Homeowner's Association references a Consumer's Report article that up to 40% of property appraisals have clerical errors in them.

So what can do about it if your property value has been overestimated, resulting in higher property taxes? You can appeal! Less than half of homeowners ever try to appeal. Many homeowners don't fight back because they either don't understand the process, or feel that the amount of research and paperwork won't be worth the time.

However, the process isn't really all that complicated once you break it down into steps:

 

1. Look up the current appraisal data for your home.

A google search that includes your state and county will usually lead you to the web site for your local tax assessor. For Denton County in Texas, for example, I'd search for [texas tax appraisal denton county]. Or for Ventura County in California, [california tax appraisal ventura county].  If those searches don't work, try substituting the word "assessor" for "appraisal".

Things to find out and note while you are on their website:

Setting your timeline for appeal:

  • When are the assessments done?
  • What is the deadline for appeals? (some counties allow 180 days or more, some only 30 days or less.)

Researching your assessed value and appraisal data:

  • What's the current assessed value of your home?
    • most county websites will let you look this up online by address or owner name...here's some example data found on a county tax appraisal website:

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  • Are there any mistakes in your appraisal? Look carefully at:
    • Is the square footage correct? If it's too high, that's a mistake that would drive the appraisal value up.
    • Similar for lot size, number of bedrooms or bathrooms, garage spaces, etc.
  • Is the county following it's own rules?
    • Many counties have a cap on how much they can increase an appraisal each year.  Sometimes they don't follow their own rules.

2. Research the values of comparable homes in your area.

  • Start with a comparison of the county appraisal for other homes of similar size and features. Try to find at least three other comparable homes in your neighborhood with lower assessed values. Obviously, the lower the appraisals, the better.
  • Then, do some research on current sales prices.  The best data is the actual sales price, which may be difficult to get on your own. If you have a friend of relative that has access to MLS data, have them do the research for you.  Other resources that might be helpful are Zillow.com, Trulia.com and RealEstate.com.

3. Compile your research into notes for the appeal process

  • A great free resource that can be helpful is the American Homeowner's Associations Property Tax Reduction Kit.  You'll have to sign up with a credit card for a free trial membership, but you can cancel the trial if you don't find their resources useful.  Membership is $10.75 a month if you choose to stay on with them, and they offer a wide variety of benefits and savings.
  • Another good resource is the National Taxpayer's Union's book entitled How to Fight Property Taxes, a relative bargain at $6.95.
  • Do be wary of other online guides and kits.  The two listed above are well regarded, and from non-commercial sources.

4. Apply for your appeal.

The process varies from county to county, but you'll need to gather your notes together. Typically, the application for a hearing with an Appraisal Review Board will require your contact information, a description of the property involved in the appeal, and the high-level reason for your appeal.  Typical reasons for appeal:

  • Appraised value higher than market value
  • Value higher than similar properties
  • Property not subject to tax by the following entity ( country, school district, etc )
  • Change in use of the property ( agricultural, etc )

You may also need to have the application form, or associated affidavit notarized before sending them in.  Be sure to check with the counties' website on the requirements for the process, or call them if you have questions.

5. Attend your appeal

  • Be sure to bring your research into detailed, but readable notes.
  • Be polite, but confident
  • Remember that roughly 1 in 3 appeals is granted.  You can imagine, of course, that those that prepare well probably do better than 1 in 3, so your chances of some relief are quite good!