How to Protest Your Property Taxes (And When)

If you haven’t been paying attention, things are expensive nowadays. Everything seems to be skyrocketing in price. From food, to used cars, to gas, to rent to home prices.

It’s as if someone has been holding a beach ball under the water and finally let it go whoosh, once released the ball quickly skyrockets upward. According to the U.S. Bureau of Labor Statistics the Consumer Price Index (CPI) has boomed almost ten percent since December 2020.

While at the same time, the Atlanta Federal Reserve reports wages have not kept pace. According to the U.S. Bureau of Labor Statistics overall wages rose as high as 6.7% in the same time frame.

As you can see in those charts we appear to be a bit of pullback, but that could just as easily reverse and go higher, no one knows for sure. This is putting a crimp on many Americans’ wallets.

To top it all off there appears to be a coming wave of higher property tax bills. We want you to be prepared. Not every assessment is going to be right. So you may have to protest your property tax bill.

Let’s explore how to do that. But first let’s take a closer look at where real estate taxes may rise the most.

Rising Property Values Mean Higher Property Taxes

Large increases in taxable value imply large increases in property taxes, or at least the potential for tax increases by local governments. There will be significant tax increases in store if they maintain the millage rate or even slightly lower it.

Property tax collections increased in 2021 compared to 2020, as evidenced by data gathered and examined by researchers at Attom.

They examined property tax information for nearly 87 million homes in the US and discovered that $328 billion had been assessed, an increase of 1.6 percent from the $323 billion in 2020. Even though home prices rose in 2021, this was the smallest increase in property tax bills in recent memory and a decrease from the 5.4% increase between 2019 and 2020.

The report’s analysis of 220 metropolitan statistical areas found that larger gains were observed in 163, or 74%, even though the average property tax increased nationally by just 1.6% between 2020 and 2021. About three-quarters of all metro areas in the study’s metro area were in those areas, which contributed to the national increase’s modest growth.

Taxes Went Up. Taxes Went Down.

Nashville, Tennessee (up 27%), Milwaukee, Wisconsin (up 18.6%), Baltimore, Maryland (up 12.3%), Grand Rapids, Michigan (up 12.3%), and Louisville, Kentucky were among the metro areas with a population of at least one million that saw the largest increases in average property taxes last year.

Pittsburgh, PA, New Orleans, LA, Houston, TX, Dallas, TX, and Austin, TX were among the major markets with the largest drops in average property taxes (down 35.1 percent, 20.2 percent, 18.7 percent, 12.2 percent, and 12.7 percent, respectively).

Keep Good Records. Keep Your Eyes Open. Be Prepared to Protest.

The first thing you can do is hire a professional property tax consultant to protest your property taxes for you. Or you can do it yourself.

HIring a Tax Professional

•  Consider these suggestions before signing a contract with a company or consultant.
•  Deal with a licensed consultant.
•  Check to see if the company’s consultants are state-licensed. For more information, contact your local assessor.
•  Agree on payment terms, such as flat fees or contingencies. Some contracts may be multi-year in nature. Check that the contract does not include any variable fees.
•  Examine the terms of the agreement you sign with the assessor carefully. Make sure you understand them and keep a copy. Do not sign if you do not understand the terms.

Doing It Yourself: Getting Started

1. Examine the information and description of your residence on your annual property tax bill. The address, lot size, square footage, year built, and number of rooms are all important factors to consider. You must record the property’s appraised value. If the appraised value of your home is not listed on your property tax bill, you can look it up on your local assessor’s website or call the property tax office.
   
2. It is critical to look up the property values or sales prices for comparable homes in your area. This information can be obtained from a local realtor or from the website of your local property tax assessor. All local government offices must make this information available to anyone who requests it. By the way, you can always go to the assessor’s office and use their systems. It must be made available to the public by law.
   
3. Determine whether there is a significant enough difference between the appraised value of your home and what you discovered when reviewing comparable properties. If you decide that the difference in your property tax bills is significant enough, and the amount of that difference is entirely up to you and also depends on the value of your property, go ahead and contest your property taxes.

Getting Prepared and The When

1. Examine your real estate tax bill for the dates when appraisals can be challenged. At some point during the year, each county or town will hold formal meetings. If this information is not on your property tax bill, you can contact your local tax assessor’s office.
   
2. Find out whether your local jurisdiction will accept informal or formal reviews. If your area allows for informal reviews, you should first schedule one with your assessor. Schedule it far enough in advance that you have enough time to prepare your case. If this is not an option, make sure to call or submit any paperwork for a formal review if an informal review is not permitted.
   
3. Gather all of the documentation you collected in the preceding steps. Organize it so that you can present the most important details first, such as information about your property and comparable properties. The amount of time you have to present your case is usually limited. 

Presenting Your Case

1. Arrive on time, be courteous, and be prepared for your meeting, whether formal or informal. If you arrive late, you may miss the only opportunity to contest the value assigned to your home. You must present your research and materials and distribute copies to everyone you meet.
   
2. Many locales have an appraisal review board to which you will present your case. Do not be worried. These boards are used to seeing people of all backgrounds present, and you do not need to be a public speaker to present your case or challenge. The documentation used in your original property tax assessment will also be presented by your local tax assessor. Again, keep your meetings brief, respectful, and professional.
   
3. Now the wait. Wait for the response to any informal request you may have made to lower your property taxes. It could take days or even weeks to receive a response. So, when contesting the assessed value of your home, you’ll have to be patient. But if too much time goes by be sure to follow up. You do not want to get hit with penalties or fees if time runs into payment due dates.

One Way To Save

A Small reminder– protesting your property taxes is just one of the ways as a homeowner, that you can save. Some other ways to save, are by qualifing for a homestead exemption for your primary residence, and many other special groups may qualify for additional exemptions as well (like seniors, for example).

Maximize any write-offs you’re eligible for, such as writing off a portion of your taxes and mortgage interest (up to $10,000), and if you have a home office, you may be able to deduct some of that as well based on the state you reside in. Talking to a tax professional is the right move if you want more tips on how to save.

However, if you need more advice regarding your mortgage or you’re ready to buy or invest in a new property, reach out to Embrace Home Loans®. We’re here to guide the way.

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