Too Much Property Tax? This Should Fix it

Property taxes are the worst. Not only does greedy Uncle Sam want you to pay income tax, but also taxes on your property. Even though real estate prices have remained relatively flat in most markets, local tax bills are trying to shoot up. So let’s take a look at how to save some money on those taxes.

  1. Look closely at your bill: The first number you will probably look at is the total amount due. This is an important number, but probably not the most important. You really need to look at the rate of taxation, and the assessed value (formulas). These numbers determine your total tax bill.
  2. Confirm that your assessment is current: tax assessments don’t always stay up-to-date. Sometimes they are only updated every few years. If property values have dropped sharply in your neighborhood, and the assessments haven’t changed, you may want to request it be reassessed.
  3. Check for errors: Criteria for assessments vary in location, but are generally based from the fair market value. The fair market value is calculated by a list of traits your home might possess. Make sure the assessment covers everything your home has to offer. Ask your local assessor’s office for a checklist if one is not available. The list will be something close to total square footage, number of rooms, number of outbuildings, etc.
  4. Research how your local government assesses property: To know how these assessments work in your area is gaining a step up in that world. Knowledge is power, so the more you know, the better off you will be. You should know how often these are performed, and how the values are determined. Some properties are assessed on recent sales; with others could be solely replacement value. Knowing how it’s assessed will give you the argument you need to have it assessed the way you’d like.
  5. Compare similar properties: Check your local records and sales on the internet to find the values of similar properties. Talk to your neighbors, and if you find something off about your assessment, make an appeal. Make sure to have proof and reason for the appeal.
  6. Check eligible exemptions or credits: During your research, see if you might be able to qualify for a homestead exemption or some other type of tax credit. These could potentially lower your bill, even if your assessment is accurate.
  7. Look for valuable freezes and discounts: Despite not being eligible for an exemption or credit, you could be eligible for a tax break. Many localities offer property tax freezes for veterans, seniors, disabled, no matter the value of your home.
  8. Ponder an appeal: If things didn’t pan out the way you had hoped, and you’re sure there was a mistake, you can make an appeal. Usually, the rules for making one, including the filing deadline and the specific protocol, are included with your assessment letter, but you can always check with your assessor’s website. You will typically state your case on why you should have a lower assessed value, and a review board will hear your case and make a decision.
  9. Listen to the pros: If you are not too confident in your evidence, or don’t know how to properly articulate your argument, think about hiring a real estate tax professional. They have the expertise on the subject and won’t steer you wrong. Yes it could be costly, but the assessment could last you several years, and end up saving you in the long run.
  10. Appeal the appeal: If your appeal was denied, try again next year. The worst they can say is no. If you feel you were wronged again, there’s always the option to appeal the denial, which is a next level of appeals. These will cost you time and court costs. But if you win, think of the refund for all the overpayments! Keep in mind you also do not get a pass while you are appealing, you must still pay your property taxes.

Do not forget that even though you are trying to get a lower assessment, it could possibly happen you get the opposite, they could raise your assessment. Do your homework and everything will work out like you planned.

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