In this world nothing can be said to be certain, except death and taxes. – Benjamin Franklin
Today’s tax environment gives new meaning to his nickname, Poor Richard. Am I right?
Once new tax systems are instituted our government is jealous to keep them in place. Sure, taxes may drop for a season but they’ll be back.
Now, property taxes may be some of the most irrational of all taxes. Stop and think about it. You’ve already paid some kind of tax when the purchase took place but the government isn’t satisfied, not while you still have more money they can take.
Property taxes too high? Should you throw your hands up and give in? This reminds me of another quote.
Don’t give up. Don’t ever give up. – Jimmy Valvano
I wrote on this topic back in 2011 when the WSJ quoted Jim Kane as saying, “More than half of homeowners are paying too much in property taxes.” What was true then may still be true for you today.
But how do you know?
Step 1: Determine Market Value
In order to learn if your property taxes are too high, we need to learn true market value. Having an appraisal done will give you a value but before you decide to pay $400-$500 to an appraiser, call your trusted Realtor to do a manually adjusted competitive market analysis (CMA) before you spend any dollars. A quality Realtor, who wants your business in the future, will do this for free.
The manually adjusted process is the same one an appraiser will use. Many times a diligent agent will produce a more accurate value than the appraiser.
If it turns out your home’s current market value is less than your tax assessment, contact your PVA and ask for an adjustment. This should cost you nothing and could save you hundreds, maybe even a thousand dollars a year.
Step 2: Appeal the Decision
What happens if the PVA refuses to budge? Remember Jimmy’s words, don’t give up! Pack up your documentation and appear before the Board of Commissioners in person and state your case.
Believe me, it’s worth the time you invest because the assessed value is often used for 2-3 years before a new adjustment is made.
I’ve seen enough cases where the value was reduced to know that many local tax assessment organizations can be reasonable, if approached through the property channels and with the appropriate attitude.
Then, if you’re really smart, you’ll take the money you saved in property taxes and make some top return on your investment home improvement projects.