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Too Much Property Tax? Try This Solution

If your property tax bills are making you sweat, you may want to double check before writing that check. Below are some simple steps to review to make sure you aren’t paying more than you should be on property tax!

1. Take a closer look at your bill

Be sure to pay attention to the rate of taxation and the assessed value. These are the numbers and formula that determine your bill and it pays to double check for mistakes.

2. Confirm that your assessment is up to date

Tax assessments don’t necessarily keep up with market value. Do some research on your area, if values have lowered recently you may want to request a reassessment.

3. Check for errors

Criteria for assessments vary according to locality but are generally tied to fair market value. That fair market value is based not on a walk-through of your home but on a list of attributes plugged into an automated valuation formula.

Make sure that information is correct for your property: you can ask your local assessor’s office for a detailed checklist if it’s not readily available. Details that you’ll want to check would include square footage (for both your house and your land) as well as the number of rooms and outbuildings, like a garage or in-law suite. You’ll also want to check the kind of property (commercial, residential, or mixed).

4. Find out how your local government assesses property

Some properties are assessed based on recent sales, while others may be assessed based on replacement value. Understand what the process for valuation is so that you can make your argument accordingly.

5. Compare similar properties

Check local records and online on sites like Zillow or Trulia to see values of similar properties in your area. If you find several comparable homes in your area that are  considerably lower than your assessed value, an appeal might make sense.

6. Check eligible exemptions or credits

As you do your research, be sure to check out whether you might qualify for a homestead exemption or other tax credit. These tax preferences might lower your tax bill — even if your assessment accurately valued your home.

7. Look for available freezes and discounts

Even if your home isn’t eligible for an exemption or credit based on its value, you may be eligible for a tax break. Many localities offer property tax freezes or discounts for seniors, veterans, and disabled individuals, no matter the value of your home.

8. Consider an appeal

If, after doing your homework, you think a lower assessed value is in order, consider requesting a reassessment. You can find instructions on your assessment letter or assessor’s website

In most cases, you’ll present your argument for a lower assessed value, such as comparable properties, for review by letter or online and a review board will determine whether a reassessment is appropriate.

9. Don’t ignore the pros

Consider hiring a tax or real estate professional with expertise in the subject if you are unsure. While the fee might take a bite out of any tax savings initially, a lower assessment should stick with you for a few years, which might make the expense cost effective.

10. Appeal your appeal

If at first you don’t succeed, consider trying again next year. Alternatively, if you want to escalate the matter, you can appeal a denial to the next level, usually a state board or court. Keep in mind that in addition to your precious time, appeals may require fees or court costs.

If you ask for a reassessment, remember that you must still pay your property taxes while any action is pending: you don’t get a free pass on your taxes during an appeal.

However, if you win, you will receive a refund for any overpayment.

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