Two common strategies for lowering property taxes are:
It's important to note that the specific methods and eligibility criteria can vary depending on the jurisdiction and local regulations.
Property owners can sometimes negotiate with the local tax assessor's office to have their property reassessed if they believe the assessment is inaccurate or unfair. Providing evidence of lower property values or comparable assessments in the area may support the case. However, this only works if you think your home value is lower than it was during the previous assessment, or if you believe there is a mistake in your assessment. Here are the steps to take when requesting reassessment.
First, reach out to your local tax office. There are several reasons why you should do this including to:
Request a copy of the assessment
Understand the process to appeal your tax assessment
Gather the relevant information
Resolve any issues informally, if possible
You’ll also get detailed information about how your property assessment was determined. This includes factors such as comparable property values, recent sales data, and assessment methodologies. Understanding the assessment process can help you determine whether an appeal is warranted and could help identify potential errors or discrepancies.
In some cases, discussing your concerns with the tax office directly may reveal errors or misunderstandings immediately — potentially leading to a fair resolution without the need for a formal appeal.
Once you’ve determined that you’re eligible to appeal the assessment and have obtained a copy of it, be sure to review the document to ensure its accuracy. Check that the information about your property's size, condition, features, and amenities is correct. If you find any errors, you can request a reassessment or file an appeal to have your property's value adjusted. If that doesn’t work, then you can look into getting your property appraised.
Getting an appraisal of your property is important for several reasons, including ensuring one has an accurate and up-to-date property valuation, sufficient appeal support, and information for future planning.
An appraisal provides an independent and professional assessment of your property's value. It takes into account various factors, such as the property's location, size, condition, and comparable sales in the area. An accurate valuation helps you understand the true worth of your property, which is crucial when determining its fair market value for tax purposes.
Since tax assessments are periodic and may not always reflect current market conditions, by obtaining an appraisal, you can compare the assessed value with the appraised one and determine if there are discrepancies or overvaluations. If such a discrepancy is found, then you might want to submit an appeal.
If you’re wondering how to appeal property tax, the process for completing and submitting an application for property tax reassessment varies depending on your jurisdiction and program. However, here are some general steps to guide you through the process:
Review and attach supporting documents
Submit the application
Follow-up and confirm
While some of these may seem obvious, having a good plan with an appropriate checklist can save you a lot of time later on in the process and avoid errors resulting from omission.
Carefully read the instructions provided with the application form. This step cannot be overstated, especially when dealing with process-driven appeals. Take note of any supporting documents or information required to complete the application. Common documents may include:
Proof of disability
Proof of age
Property ownership documents
Previous year's tax statements
If any of the instructions appear unclear or nebulous, contact your local office again to get clarification.
Once you’ve completed all of the above, fill out the application form accurately and completely. Provide all the necessary information as requested. Review the list of supporting documents required and ensure you have gathered all the necessary paperwork. Make copies of the required documents and attach them to your completed application form. It's recommended to keep the original documents for your records.
After submitting the application, it's a good idea to follow up with the tax office or agency to ensure they have received your application, it’s being processed, and when you might expect an answer.
If lowering your tax assessment is not a viable option, then you can apply for tax relief. Certain municipalities or states have programs designed to assist homeowners with lower incomes or those facing financial hardship. These programs may offer property tax deferrals, installment plans, or subsidies to help reduce the burden of property taxes. Listed below are a few steps to follow this path.
Investigate whether you qualify for any property tax exemptions or tax deductions for homeowners offered by your local jurisdiction. These may include exemptions for senior citizens, veterans, disabled individuals, or specific property uses like agricultural land.
There are a number of programs that provide property tax relief. These include various exemptions, abatements or caps, or freezes. While not an exhaustive list, details follow.
In some areas, homeowners can claim a homestead exemption, which reduces the assessed value of the primary residence for property tax purposes. This exemption typically applies to a certain amount or percentage of the home's assessed value and often requires a minimum ownership period before one is eligible.
As mentioned above, homes owned by veterans, senior citizens, or people with disabilities may qualify for exemptions. Tax abatements or incentives to encourage certain activities — such as home renovations, energy efficiency upgrades (such as installing solar panels), or revitalization of specific areas are another option.
The process for completing and submitting an application for property tax relief varies depending on jurisdiction and program, but the overall steps should be similar to appealing one’s tax assessment above.
Since property tax laws and policies vary by location, understanding all the nuances and avoiding pitfalls may be too much for many homeowners. If that’s the case, they should seek professional advice to understand the specific options available to them and determine which strategies may be most effective in their area. FinanceHQ can connect you with a trusted advisor who can help identify current needs, consider tax implications, and analyze how home ownership, in general, fits into an individual’s or family’s overall financial plan. Get matched with a financial advisor today!
Amanda brings 30 years of experience in banking and finance.