Should you file a property tax appeal?  Is your property value assessed too high?  A lower assessed value translates into less property taxes.  Examine the details in your property’s assessment.  Learn how the property tax appeal process works in your area.  Additionally, weigh the likelihood of success before making the decision to file a property tax appeal.  I appealed property assessments three times in two different states.  It’s been educational.  Recall The Money Skinny™ mission is to save you time and money.   Let’s review five factors to consider in deciding to pursue a property tax appeal.

5 Factors to Consider in a Property Tax Appeal

• Look for evidence of an over-assessment.  Compare the purchase price plus improvements to the assessed value.  For example, an assessed value of twice the purchase price.  Is the housing market really that hot?
• How long will you own the property?  The longer the ownership, the greater the future savings in a reduced tax bill.  Selling in the next year or two?  A successful appeal benefits the next buyer.
• Compile twelve to twenty-four months of sales data for surrounding property.  Highlight property of a similar size and age.  How do property assessments compare to the sales data?
• Review surrounding property currently for sale, particularly of a similar size and age.  Actual sales data is more important than For Sale listings.  Check Realtor.com for sales info.  Sales that occur between when a case is filed and later evaluated may enhance or hinder the appeal.
• Do an internet search to understand your local appeals process.  Can the appeal be filed on-line?  Do you have to appear in-person?  Does it seem to require a lot of stamina with volumes of data that may not be easy to obtain?  When is the filing deadline?

My Property Tax Appeal Experience

The three times I filed a property tax appeal, unfortunately all the cases were denied.  Ouch!  In my opinion, local assessors have a bias toward denial.  Lowering an assessment may be seen as correcting an error made by the assessor office.  Plus, lower assessments mean less tax revenue.  Appeal boards hear an-going chorus of complaining voices saying they pay too much taxes creating a Property Tax Festivus.  Finding a case that truly warrants review isn’t easy.  The appeal and its supporting data needs to be compelling to an objective observer.  Similar to overturning a referee’s call with instant replay.  The play on the field stands.

In hindsight, my cases may not have been egregious enough.  The Property Tax Festivus drowned me out.  Weigh the time investment filing an appeal combined with the ultimate goal against the likelihood of success.  Cutting a property tax bill in half may be worth deciphering the appeals process.  Shaving a small percent off the assessed value yields little tax savings.

You prepare a well documented property tax appeal case.  The case is denied.  Welcome to the club.  Does your ticked-off self fight back by planting a For Sale sign in the front yard?  Nope.  Simmer down, Stan.  Instead, you realize that when it is time to sell your property you can justify a lofty list price.  The assessor says your property is worth it.

• Examine the property assessment appeals process in your local jurisdiction.   Is an appeal likely to be successful?
• The case and its supporting data needs to be compelling to an objective observer.
• Weigh the time investment combined with the ultimate goal against the likelihood of success.