How to Appeal Your Property Tax Bill

How to appeal your property tax bill

How to Appeal Your Property Tax Bill

One of the downsides of being a property owner is the annual ritual of opening your property tax assessment. Unfortunately, you’re never going to open the envelope and be happy with what you see. But if you think you’re legitimately paying too much, you’re far from powerless. You can learn how to appeal your property tax bill.

​A significant number of people simply throw up their hands in frustration and on sign the dotted line. However, there’s a decent chance that if you spend some time looking into the details that you can find some leeway or some leverage that you can take to the tax assessor and have them reduce this year’s (and possibly every year’s) assessment.

Here are some of the key points on how to appeal your property tax bill:

Pay your bill

Remember that dealing with a bureaucracy isn’t always a speedy process. Even if you think you’ve got a slam dunk case to appeal your property tax bill, you need to pay your outstanding assessment (in whatever form it currently takes) on time.

​Initiating an appeal doesn’t exempt you from paying your taxes. Pay your assessment before the deadline. If and when the appeal comes up in your favor, you’ll receive a refund. It’s much easier to pay now than to try and argue your way out of fees and penalties later. Save yourself the headache.

Learn the rules

For the most part the process is fairly similar from region to region, but the details (and deadlines) will vary. If you intend to appeal your property tax bill, it’s important to understand what time constraints you have, and what hoops you have to jump through.

For example, some jurisdictions may give you 90 days to appeal, others only 30. If the information on how to appeal your assessment doesn’t arrive with your assessment, look to your tax assessor's website or call them directly. They’ll be able to give you details on how it is they arrive at the amount outstanding.

They will also be generally very helpful with informing you on how to walk through the appeals process. You’ll need some time to gather your information and make your case. Don’t delay.

How did they come up with that number?

In its most basic form, they’ll take your property value (land and structure), multiply that by the tax rate and send you the bill. However, they won’t necessarily send someone to assess your property directly. They could be looking at a sample of other properties in the area, or possibly even looking at the amount you paid for the property.​

Put in another way, there’s likely room for you to make a compelling argument for why your tax bill should be less.

  1. Did they make an error? The Tax Assessor will be looking at the records it has about the building on the property. Double check it’s actually representative of what’s actually on the lot. Mistakes happen and it’s possible they might be calculating a bill based on wrong information. For example a house with a few extra bedrooms. They’re humans too - and if you spot an error, they might very well correct it on the spot.
  2. Is your property value comparable? If you’re in a neighborhood where the lots and the houses are all nearly identical, it’s worth taking a look at how those properties are being assessed. If for some reason four of your neighbors are paying less, why are you being treated differently?
  3. Are you different in ways they don’t see? If you’ve got problems with your foundation or your basement that would affect your property’s sale value in a significant way, the tax assessors won’t necessarily be aware of that. Properties are always more nuanced than they appear on paper. Aand there are many potential factors that could turn off a potential buyer. This isn’t a matter of opinion, you can gather documents to build your case.

Tax breaks

Looking into the tax shields is a little more legwork simply because these are more likely to be different depending on where you are in the country. Doing some research on the department of taxation’s website, or contacting them directly could reveal some rules that work out in your favor.​

As an example, some states allow for a homestead exemption credit on properties that are the primary residence of the property owner. There are also tax credits set up for Seniors, Veterans or persons living with a disability.

It’s not impossible that the rules where you live allow for a completely sanctioned tax break you were unaware of. Doing some research upfront can reduce your tax bill year over year.

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Make a strong case

​There are different levels at which you can appeal your property tax bill. Most start with an informal hearing, formal hearings where you present to a board, and possibly even appeals at the state level. However, you’re much better off if you do your best to make a compelling case at the informal level. If your situation warrants a quick change, this is where it will happen.

​Read all the fine print to make sure you’re in compliance. Then gather all the information you reasonably can such as photographs, repair estimates, bill of sale, listings of comparable properties. In other words, gather whatever is appropriate for the claim you’re trying to make. You want to make it easy for them to agree with you that your assessment should be reduced.

​If it strengthens your case (and if your community allows it) it may be worth spending a few hundred dollars on a nationally certified appraiser to look at your property. Look at the Appraisal Institute or the National Association of Independent Fee Appraisers.

Taking it to the next level

This can be a long game. Waiting for hearings can take months. However, if the saving is significant, and will roll over year-over-year, it may be worth being stubborn.

​Hiring a law firm will quickly cost you more than you’d save. There are services that will do some or all of this work for you. However, the process to appeal your property tax bill is relatively straightforward that you can do most of this yourself. Consider hiring a professional if you’re lacking in time, or challenging the assessment on multiple properties.

About the Author

Canadian CPA and Freelance Financial Writer.

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