How to Calculate Property Taxes?
Property taxes are determined based on the value of the property. They are commonly known as a type of tax that is based on value, as “ad valorem” from Latin means “according to value.” Property taxes are calculated by applying the tax rate of the taxing district to the assessed value of the property. Property taxes can vary significantly from state to state and even county to county. For example, they are highest in New Jersey (2.2%) and lowest in Hawaii (0.37%) according to data from ATTOM Solutions. The average American homeowner pays a tax rate of 1.1%.
Before Challenging Your Property Taxes
Your city or town sends you an assessment notice each year. You may receive this document separately, or it may be part of your property tax bill. If you believe there is an error in the calculation of your property taxes, you can challenge it, but you will need to prove that the figure set by the assessor is incorrect. “The best evidence to support an assessment adjustment is a recent appraisal or recent sale of the property, or recent sales of comparable properties in your area,” said Tom Parrish, director of bank lending at BMO Bank in Elmhurst, Illinois, according to The Balance.
Reviewing the Numbers
First, review your property record, which you can find at the local tax office. Make sure all information about your home is accurate, including the number of bedrooms and bathrooms, square footage, and other distinguishing features. If any of the details in the property record are incorrect – for example, if it mentions a double garage instead of a single garage – you can use these errors to support your claim of an overvaluation of your home.
Comparing Your Home to Others
You can support your arguments by looking at comparable properties that have sold recently in your area. If four homes in a half-block radius sold between $250,000 and $275,000, and your similar home is assessed at $325,000, you can use this data to demonstrate that it has been inaccurately assessed.
Filing an Appeal and Requesting a New Assessment
So, what if you have evaluated your property record and comparable properties in your area and still believe your assessment is incorrect? You can appeal the dispute and request a new assessment. “File an appeal with your county assessor’s office,” according to Tom Parrish. “Please check with your local assessor for details on how and when to file your appeal.” In Cook County, Illinois, for example, you can file an appeal online by following these steps.
You will need to provide an email address to create an account. Take note of the assessment information number that was provided to you, which you can use to track the appeal. Attach any relevant documents with the appeal, such as a recent appraisal or photos of the property. The Cook County office provides you with a free tool to identify and attach comparable properties in the appeal. Submit the appeal within 30 days of receiving your reassessment notice. If you miss the deadline, you will have to wait until the next year to file an appeal. You can also hire a property tax attorney to handle the appeal. If you choose this route, remember that you will have to pay the attorney’s fees, and there is no guarantee that the outcome will be in your favor.
Your Options After the Assessment
So what happens if you do not agree with the new assessed value you receive after the appeal? According to Parrish, you have two options. “The first option is to hire a lawyer specializing in property tax appeals to try to escalate it further,” he said. “The second option is to ensure that your evidence for the original appeal is sufficient and has enough support to justify the change (for example, you have a recent appraisal and can demonstrate a clear comparison with similar properties to yours), and then determine the values of similar properties that the county uses to assess your property’s value.”
Questions
Repeated
When will I receive the results of my property tax appeal? That will depend on the assessor’s office; however, even if you submitted an appeal via email, results are usually sent by regular mail.
Do I need to hire a lawyer to appeal my property taxes? How much does that cost? You can file an appeal online by yourself for free. If you choose to hire a lawyer, costs vary.
If I win my property tax appeal, when will my mortgage payment change? If you win your property tax appeal, you will not notice an immediate change. Again, details may vary by county or state. In Cook County, for example, any adjustments received in 2021 will reflect on the 2022 bill. However, you may find that the tax appeal results in an increased assessment of your home, which could lead to a rise in the amount you pay in property taxes.
Source: https://www.thebalancemoney.com/how-appeal-property-taxes-and-win-5198490
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