Appealing a Property Tax Assessment

Written by
Kara Johnson
Read Time: 5 minutes

Property values have gradually been recovering from the lows they fell to during the recession. While that's generally good news for homeowners – higher property values mean increased home equity – there can be a downside as well: an increase in your property tax assessment.

Property taxes, of course, are based on property values. So when home prices rise, so do your property taxes.

Your property value assessment is what your local officials think your home is worth. You might have a different idea about that. And if your property assessment is too high, you'll end up paying more taxes than you ought to.

If that happens, you can appeal your property tax assessment. The process itself is fairly straightforward, but you need to do your homework to be able to make a convincing case about your home's true market value. And local governments often don't make it easy or convenient to do so.

Is your property assessment accurate?

The assessor is the local official responsible for determining property values used in tax assessments. He or she uses a variety of tools to do this, primarily sales prices of similar nearby homes, but also taking into consideration the particular features of your home, like square footage, age, number of bedrooms, etc. In some cases they may also take into account the estimated replacement cost of the structure and what the home might be able to command as a rental.

Because they're responsible for the entire community, assessors rarely take a close or in-person look at individual homes. They may inspect a home periodically or after major work is done, but usually they simply adjust values for a neighborhood as a whole, based on sales data.

The problem is, your property value assessment may not reflect the true market value of your home. The sale of several higher-value properties nearby could throw off estimated values for your whole neighborhood. Or your home may have certain differences from other nearby properties that mean the price it can command has not risen as quickly as others have.

Government entities also rely on property taxes to fund their operations and essential public services like schools and roads, which can create pressure on assessors to take an optimistic view of property values in their community.

Appealing your property tax assessment

Appeals of property tax assessments are usually done before an equalization board, board of review or similar panel, although in some states initial appeals are submitted to a single official. These boards or officials have the authority to lower your assessment, but the window to do so is usually limited. In many states, you can only file an appeal within a certain time after receiving the notice of your new assessment - in some cases, as little as two weeks.

That means that if you want to appeal your property assessment, you need to do your homework and be ready before it arrives in the mail. You probably have a good idea already if you're going to want to appeal or not, based on your current assessment - if you think your last one came in high, there's a good chance your next one will as well.

The schedules by which property assessment notices are mailed out vary widely from state to state - there's no consistent pattern. Deadlines for requesting appeals can be all over the calendar – in some states it may be late winter or early spring, in others appraisal notices may be sent out and appeals heard in midsummer or late in the year.

Using comparable sales

When you appeal your property tax assessment - which you'll need to do in person or in writing - you need to make a case that the official assessment has overestimated the actual value of your property. To do that, you need to present convincing evidence in the form of comparable sales of other homes in your community. You can usually find public records of recent sales through the same assessor's office where you'll be filing your appeal.

Comparable sales are sales of homes that are similar to yours and are either in your neighborhood or one like yours. You can adjust for certain features like square footage or number of bathrooms, but generally you want to find homes that are of a similar style, age and quality to your own. If you can't find enough comparable sales in your immediate neighborhood from the past year, look for other neighborhoods in your community with similar homes and where property values have been similar in the past.

Be wary of relying on sale prices of foreclosed properties. Foreclosures sell at a significant discount compared to conventional home sales. Assessment boards know this, so the more you can support your case with sales data from conventional home sales, the better.

Some counties and municipalities provide advice on how to assemble information on comparable sales and put together a presentation to the board. In general though, you're going to have to research it on your own.

Making your presentation

When you make your presentation, stay focused on making a good argument for the actual value of your property. Property tax appeals boards won't be swayed by references to financial hardship, the other taxes you past, your military record or other evidence of good citizenship - all that matters is what your home is worth on the market. The more objectively and persuasively you can make that case, the better your chances are.

Equalization boards also won't reduce your assessment due to financial hardship or retroactively reduce your assessment from previous years. If you disagree with their finding, however, you can usually appeal to a higher authority, such as a state board of review. The names and number of these higher authorities vary from state to state, so you'll need to check with your local assessor's office to see what the procedure is in your state.

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