It's the letter every homeowner dreads: A notice that their property taxes are rising. Higher property taxes can squeeze your budget and diminish the resale value of your home. But can you do anything to lower them? In some cases, you can fight city hall.
Why property taxes increase
Property taxes can rise for a couple of reasons. The local government may increase taxes to raise more revenue. Or it may conduct an assessment and decide your house is worth more. More valuable properties get taxed more, leading to higher bills for the owners. (Policygenius can help you lower your homeowners insurance bill.)
You can't do much to challenge your town's budgetary needs, short of running for office. (Read our state guide to voter IDs.) But you can challenge their assessment of what your property is worth.
How to file a property tax appeal
If you receive a notice that your tax rate or assessment are rising, look it over and decide if you think it's fair. If you believe your house isn't as worth as much as your town says it is, you can file an appeal to lower their assessment and in turn lower your tax bill. But you may want to rely on more than your gut reaction before going through the formal process of filing an appeal.
If you recently purchased your home, the purchase price is fresh data point with which you can challenge the assessment. If you bought it for less than the assessment, that's a solid basis for a successful appeal. You can pay a real estate appraiser to judge the value of your home. A real estate agent or broker may also give you an idea of whether your home is properly assessed. You can also look for sale information online.
"Basically you're looking to get an independent evaluation of what your home is worth," said David Wilkes, a property tax attorney in New York.
Towns usually set a deadline for filing a property tax appeal, so have that date in mind.
Make sure you have a sturdy case before filing an appeal. In some communities, an appeal can only lead to a lower assessment, but in others, it's possible for the appeals process to end in a higher assessment, and higher taxes, said Wilkes.
"If you're just taking a stab at it, that's something you want to avoid because there are situations where your assessment might end up going up," Wilkes said.
Do you need a lawyer?
It depends. Appeals are usually handled at the local level, so the process can vary. Some places, like New York, are more cutthroat, and lawyers get involved in the appeals process more often, Wilkes said. Other areas may have more user-friendly processes, so lawyers are less of a necessity.
Wilkes suggested speaking with your local tax assessor to get a feel for the process. He recommended paying a visit even if you don't plan to file an appeal.
"I wouldn't hesitate to go to town hall and really explore the records and talk to the assessor and learn more about your tax assessment," Wilkes said. "People don't really look until they get a big increase."
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