What is a property tax appeal?
Taxpayers cannot administratively appeal the amount of taxes they pay; however, they may appeal their property tax assessment. This is the value that the municipal tax assessor places on a property, and this is the number that your town’s tax rate applies to. All other things being equal, the higher your property assessment, the more in taxes you must pay.
How is a property tax appeal filed?
There is only one chance per year to appeal property tax assessments. Typically it must be done by April 1 of the year being appealed. Taxpayers must submit appeals to their county’s Tax Board and serve notice to all appropriate parties. Appellants must also provide evidence supporting their appeal at least seven days before their hearing date.
How do I prove that my tax assessment is too high?
The burden is on you to prove that your property is over-assessed. Evidence used to support the value of a residential property generally (but not always) takes the form of comparable sales from within the sampling period. Sales made before or after the sampling period are not usable as evidence, nor are those which fall into one of several “non-usable” categories. For example -- estate sales, even from within the sampling period, are generally not accepted by County Tax Boards as evidence of value.
Do I need to hire an appraiser as part of this process?
In a residential tax appeal an appraiser is not absolutely necessary to prove home values. A listing of comparable sales may often suffice. However, in higher-value residential properties -- defined as those valued at $500,000.00 or higher – we highly recommended that appellants obtain a preliminary appraisal report to support their claim. We have an arrangement with a well-respected appraisal firm which will supply you with an appraisal report to support your case for a much lower cost than is usually charged. We do not receive any compensation for taz appraisals and have no financial arrangement with the appraiser. If you have worked with an appraiser in the past and wish to use his or her services you certainly may. The up-front cost of a county-ready appraisal report is generally in the hundreds of dollars, and almost always pays for itself in the first tax season that you realize savings. Each year thereafter the entire amount of savings goes directly to you.
Can I use the appraisal report I got from re-financing my home as evidence?
While it may help you decide whether an appeal is warranted for your property, the appraisal report issued for the purposes of re-financing your property is generally not acceptable evidence for a tax appeal. A re-financing appraisal report generally uses different data than what must be used to prove home values for tax appeal purposes.
I looked at my tax bill, and the assessed value of my home seems much lower than it should be. Why?
In most municipalities the assessed value is not the same as the actual fair market value claimed by the Assessor. The town’s Average Ratio must be applied to the assessed value of a property to determine the fair market value of the assessment. Some municipalities have average ratios as low as 1/3 of the actual fair market value of the house. But that is not all. Even if a property is over assessed after applying the average ratio, we must still apply the upper and lower limit ratios to see if you have a case. Homeowners must not only prove that their property is over-assessed, it must be over-assessed by a statutory percentage. For example, if you can only prove that your $500,000.00 assessment should really be $499,000.00, you do not have a good case and your assessment will most likely remain at $500,000.00. A different ratio must be applied for each municipality.
Do I have to attend the tax appeal hearing?
This is highly fact dependent, as the vast majority of cases are settled beforehand between your attorney and the municipal Tax Assessor and don’t require a trial before the Tax Board. However if the Assessor makes no offer to settle your case, or if the offer is too low, it may be in your best interest to try the case. Although it is not absolutely necessary that you appear at this trial, it is highly recommended that you attend. You are generally the only person other than an appraiser who can present factual testimony on your own behalf at the trial. If you have hired an appraiser to support your case, it becomes far less important that you attend the trial.
Once I get a judgment lowering my tax assessment, do I have to appeal again next year?
Generally you do not. The Freeze Act applies to most County Judgments, meaning your assessment may not be raised by the municipality for three tax years including the one you appealed in. There are some exceptions to this rule, for example if your municipality conducts a revaluation of all properties in its borders, or if you make significant improvements to your property, the Assessor may raise your assessment. But in the majority of cases the Freeze Act applies, and even when it doesn’t it is not uncommon for a tax assessment to remain unchanged for as long as decades.
Can I appeal a County Level appeal to the State Tax Court?
Yes. You have a limited amount of time to file your State-level appeal. We would be happy to discuss your options at State Tax Court, in certain cases you may have more success in that jurisdiction than at the County level. In the event that a client wishes to appeal on the state level, we would work out a new engagement agreement before doing so.
What do you mean when you say that hiring your firm to handle my tax appeal costs me nothing?
We charge nothing up front other than the filing fee which goes to the County. If we do not save you money on your taxes, we do not get paid. This is because we work on a contingency basis. Our fee is ½ of the amount of money we save you on your taxes for one year. If we save you $1000.00 in 2013, our fee will be $500.00. That’s it. In most cases this savings will continue year after year, but our fee is for one year only. Even if you account for paying an appraiser to provide a report, the better result in the end will usually pay for itself, and will most likely save you more money in future tax years than if you had not hired an appraiser.
If I win my tax appeal in 2013, will my savings next year be the same as they were this year?
Remember, you pay your taxes based on the assessed value of your property. So a 20% reduction in your assessment, for example, will be a 20% reduction in the property taxes you pay, no matter what the tax rate is next year. In many municipalities, the actual tax rate for 2013 will not be set until the fourth quarter of that year. That is why our retainer agreement applies our fee to the 2012 tax rate, not the 2013 tax rate. This often further reduces legal fees since taxes in most municipalities either stay the same or go up each year.
I have an abatement on my property, or I’m not sure if I have one, can I still appeal?
If you have an abatement on your property and you appeal your assessment, the Tax Assessor may move to eliminate your abatement. Call us if you are unsure about whether you should file, as we can guide you through the common pitfalls in this area of law.
I received a judgment lowering my tax assessment. When will I see the savings?
Every case is different, but there are several ways you could actually see your savings. If you appeal your 2013 tax assessment, and are successful, you will most likely not receive the actual judgment until August or September of 2013. Many municipalities will simply apply the total savings for the year to the fourth quarter tax bill. However in recent years, given the high numbers of tax assessment appeals filed, many municipalities don’t apply the reduction in time for the fourth quarter bill. In this case, you would pay the entire original amount of the fourth quarter, and your savings would be mailed to you after January 1. If you pay your taxes through a mortgage company, it is possible that the savings will go through them. You may receive a check for the amount you overpaid in 2013 and your 2014 monthly payments would be reduced appropriately, or that amount may be applied to your escrow account if it is low. All municipalities handle the reductions differently, as do most mortgage companies. However once we successfully reduce your assessment, we can guide you through the process of ensuring that you get paid in a timely manner.
Can I appeal my own property taxes?
You have the right to represent yourself in tax court as long as you are not a business entity. For example, a corporation must be represented by an attorney for a tax appeal. However this area of law has many complications, and if you don’t know what you are doing you could compromise your own interests. This FAQ section alone does not provide adequate information and advice to represent yourself, it Is simply answering some of the common questions clients may have. Each and every case has specific circumstances which must be addressed, and general information is just that, general.
The savings you get from a successful tax appeal usually carry on for several years. It is a wise investment to do it right in year one, and hiring professionals to represent you and ensure that you don’t waste your time and money in the long run is just common sense.
I am not sure whether I should file a tax appeal, what should I do?
You can call DePaul Law Firm at (973) 376-8585 or just e-mail us at firstname.lastname@example.org, whatever is best for you. We can look up your current assessment, and after asking you a few questions we can often give you an answer on the spot.