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Appeal Your House’s Assessment to Lower Your Property Tax Bill

This article was written by in Real Estate and Home, Taxes. 7 comments.


The comparison of owning a home in New Jersey or Long Island with owning a home in New York City shows that the city has one financial advantage: property taxes. In New Jersey, it’s hard to discuss the cost of owning a home without talking about property taxes. With high property tax rates, it’s worthwhile to take as many actions as possible to reduce those rates. When filing personal income tax returns, taxpayers look for every deduction and credit, saving hundreds or thousands of dollars, but most homeowners accept what they owe for property taxes, even though that could easily be a bigger bill than income taxes.

With home prices on average having dropped in the past few years, now is a perfect time to take a look at these taxes. The amount of property tax you owe is based on an assessed value of your house, and depending on where you live, that assessment could have occurred when the market was at its peak. On average, assessments lag behind current values by three years.

Homeowners could save thousands of dollars with a successful appeal. We’d like to think our home values continue to increase because we want to feel that the decision to buy a home will result in a good investment over time. When it comes to assessments for tax purposes, it’s better to have the lowest value possible. Review your recent assessment, and consider these factors for appeal:

  • Comparable home prices. Look at actual sales of houses in your area. Knowing the current market is a key to determining a fair assessment for your house.
  • Age of the assessment. If the assessment is from over a year ago, comparable homes in your area might have sold for less money more recently.
  • Room count and layout. Most assessments are accomplished without definite knowledge of your house’s layout. There could be mistakes in your assessment that result in a higher value on paper, like too many bedrooms. If your basement is unfinished, you could argue for a lower assessment.
  • Amenities. When assessments are based on comparable home prices, if your home does not have the same amenities as your neighbors’ houses, you could be unfairly assessed. If you don’t have a pool like the houses surrounding yours, you shouldn’t have the same property tax bill.

After you receive notice of your newest assessment, review it quickly and repeal right away. Review the property record card and look for inaccurate details. Take photographs of relevant features of your house. Look at documentation for comparable home sales in your neighborhood. When you have your hearing, bring all the documentation to support your case. Authorities are aware that most assessments are inaccurate, but they won’t do anything unless owners speak up, and some who are unsuccessful with the first appeal give up. The savings from a successful appeal could be substantial, so don’t give up until your home’s value is accurately assessed.

Wall Street Journal

Published or updated August 23, 2011. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes, also known as Flexo, is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow Luke Landes on Twitter. View all articles by .

{ 7 comments… read them below or add one }

avatar shellye ♦107 (Cent)

I did this about 10 years ago. Saved me thousands of dollars during the years I lived in the home. The process can be a little tedious, but totally worth it, especially in today’s housing market.

Good column, Flexo.

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avatar Evan

I just did this for the first time for someone and was amazed how easy it was…the ease actually annoyed me. It is such a scam…it goes up every year and just by asking and filling out a few forms they drop the amount owed? I am not sure how it is done elsewhere in the Country but between Long Island and Jersey it is crazy the amount of taxes collected (and subsequently squandered)

/rant

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avatar Rose

So how do you start this process?

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avatar qixx ♦1,890 (Half-Dollar)

Assuming you’ve done the leg work and think your home is over-valued there will be a form to get from your County Assessor’s Office. You can likely download the form from your city or county website. You fill out the form. Attach any documentation and mail it in (or drop off if available). Then sit around and wait, and wait, and wait, call the office to check on status, be told it is “being processed”, wait some more, yet more waiting, more waiting, another check in, still “being processed”, eventually be told they are requesting more documentation (or if you are lucky told the assessor will be by on day X), lots more waiting. Eventually you’ll get a decision letter from the County Assessor’s Office.

If you have not done the leg work then step one is do the leg work.

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avatar Jon

I have the exact opposite situation. My property tax assessment has dropped by huge amounts the last two years. It’s wonderful because my property taxes have gone down. But the bank cancelled my HELOC which I was actually using (perhaps I’m the only person in America who was) to make improvements to the home, and now my real estate agent tells me that the assesment will make it very difficult to get a decent price when I sell. Should I appeal?

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avatar qixx ♦1,890 (Half-Dollar)

Another key point to lowering your tax assessment value is to pay attention to who your county assessor is. Find out how many appeals have been successful. Keeping around someone in that position that is consistently over valuing homes is one way to ensure you too will be over paying for a poor assessment.

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avatar lynn ♦155 (Cent)

I did this the minute we moved in. The assessment went down the next year.

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