Tricks to save money on your property taxes
Forget about keeping up with the Joneses. This time of year you want your house to be as crummy as possible. Why? Because it’s property tax assessment time, which means it’s also assessment appeal time. And if you can successfully argue that your house isn’t worth as much as the government says it is, you can save a bundle of money on your property taxes.
Josh and Alicia Green embraced the concept of trashing their own house, writing a description for their appeal that was the polar opposite of a real estate agent’s gushing ad. “We reminded them we lived on a busy road, Western Avenue,” Josh Green said. “We also told the city about costly repairs we needed, like a new roof.” In addition, the Greens noticed that the District listed their house as having three bedrooms. “But we alerted them that the previous owner had knocked out a wall and made it two bedrooms, thus lowering the value more,” Green said.
According to the National Taxpayers Union, less than 5 percent of homeowners do what the Greens did, even though the union estimates that between 30 and 60 percent of properties in the United States are over-assessed. “The vast majority of assessors are not malicious or careless; they are simply making judgment calls about how to utilize limited resources in tackling a big job,” said Pete Sepp, the union’s president. “Homeowners shouldn’t take it personally, but they shouldn’t assume the government is right, either.” Sepp says that when well-prepared homeowners take the time to appeal, most win at least a partial victory.
Here’s how to improve your chances of being one of the winners:
●Meet the deadline. Tax assessments in the District, Maryland and Virginia are mailed out January through March. (In some parts of the country, they arrive in the last quarter of the year.) Once you receive your assessment, you typically have just 30 to 120 days to file your appeal. Check the rules for your jurisdiction and make sure your paperwork is postmarked by the deadline.
●Understand “assessment ratios.” Some jurisdictions tax your house based on 100 percent of its value, but others assign a lower “assessment ratio,” such as 60 percent. This means a house with a market value of $100,000 would have an assessed value of $60,000. If you see a number that’s lower than your home’s true value, check the assessment ratio before assuming you don’t have a case. You can find that ratio on your actual tax assessment notice or on the assessor’s office website.