Because every homeowner who protests their appraisals, with an understanding of how the property tax appraisal system works, often receives tax savings of $ 500 to $ 1000, if not more annually on their property tax bill. the property. Simply put, the property tax bill is calculated by multiplying the homeowner’s assessment by the local property tax rate and subtracting the tax deductions for which the individual homeowner is eligible.
Your property tax doctor can show you how to lower your appraisal and therefore lower your property tax bill! The property tax doctor is a former tax assessor who knows firsthand how difficult it is for the average person to penetrate the bureaucratic jungle of the tax assessor made up of arcane terms and practices. No government document does this for the home owner.
Like going to a doctor’s office, the first thing to do is gather the information you need to do the paperwork. The primary sources of that information are the owner’s property registration card obtained from the appraiser’s office and comparable home sales. Most homeowners armed with one or both pieces of information get their appraisal reduced most of the time without going beyond the local tax assessor’s office.
Just as you ask your doctor informed questions to get some pain relief, you should also ask your tax advisor (with the help of the property tax doctor) some informed questions in order to gain some tax relief from the property. The best advice your property tax doctor can offer is to go to your local tax assessor’s office and check your property registration card for any errors of fact. Administrative errors and simple errors occur during the valuation process. Here is a partial list of common mistakes to check for.
1. The dimensions of your house or the dimensions of your lot are incorrect.
2. Not noticing depreciation in adverse conditions on the site or showing no depreciation or minimal depreciation for an older home.
3. The dimensions of your land are wrong.
4. Check all calculations, whether or not you understand where the factors come from.
5. Disregard influences that depreciate off-site: a factory or a landfill that produces toxic gases.
6. The quality of upgrades is wrong — you have a stone, not a macadam driveway, or — you have the low-priced hot tub, not the big-name expensive hot tub.
7 Completed areas are listed incorrectly — basement is showing as finished and it is not.
8. The age of the house is listed incorrectly or the number of floors is incorrect.
My father wouldn’t let the local tax advisor, who was also his best friend, walk past the kitchen table on our farm. My father was afraid to see certain improvements inside the house and increase our evaluation. My father mistakenly believed that the improvements he had made inside the cottage, such as a new bathroom sink, plaster repairs, wallpaper, new ceilings, new light fixtures, would add to our appraised value. It also postponed external repairs until after the next revaluation for fear of a higher appraisal. Surprisingly, he was wrong. External repairs like roof replacement, masonry repair, porch repair, steps, stairs, etc. do not increase the homeowner’s appraisal. Neither does the replacement of garage doors, sheds, sidewalks, etc.
Often times, establishing the proper combined property value for your home and the land below it is the key to your property tax appeal. To win your appeal, your homeowner must set your property’s value at a lower level than what the appraiser used.
To establish the market value, the homeowner can visit the website http://www.zillow.com to obtain a rough estimate of the value of their home. The site uses some basic variables such as square footage, number of bathrooms, acreage, and number of bedrooms to calculate the market value of the home based on a formula driven by other home sales in the neighborhood. Where zillow has the sales data, this is a good first step to see if your home is rated too highly.
In the years after the revaluation year, the homeowner must find out what the relationship is between the appraisal and sales for his New Jersey tax district. This ratio is advertised each year and is available at your local tax assessor’s office. It represents the average to which the appraised value of all properties that were sold last year was compared to their sale value in the municipality. Because it is important? It can provide a key factor in showing that you have received an unequal appraisal and have the right to file a discrimination challenge in the appraisal of your property to earn a tax reduction.
An uneven evaluation is one performed at a higher proportion of market value than the average of the other parcels on the roll. A year or so after a home revaluation, inflation often makes the appraisal your tax advisor placed on your home appear low compared to the sale prices of comparable homes sold in your neighborhood. But beware!
A low sales appraisal rate in a municipality can mislead some taxpayers into thinking that they are being appraised below market value and therefore getting a break. However, if all assessments are set below market value, the tax rate must be increased to collect the necessary amount of tax revenue. The same amount of taxes are collected, but taxpayers are misled into thinking they have had a break and are not looking for bad evaluations.
Now, don’t forget that the appraisal-to-sales ratio (or common-level ratio) is a key factor in obtaining a property tax relief. Let me explain. An important test of the fairness of your evaluation is not only its relation to market value. It is also about whether or not you are fair relative to evaluations of other properties in your city. For example, if you have a house with a market value of $ 800,000, but it is priced at $ 600,000, you may think that you are getting cheap. However, if your neighbor’s house that is comparable to yours is valued at just $ 200,000, you are paying three times more property taxes than you should!
When your property is under appeal, the County Tax Board can adjust the value of your home to the common level. The taxpayer must know the average proportion in the municipality where the appealed property is located before filing a tax appeal. Remember that the ratio changes annually on October 1 for use in the following fiscal year. Also, remember that this common level adjustment is not used in the revaluation or revaluation year when all properties have been brought to 100% market value.
Once the County Tax Board determines the true market value of a property, they are required to automatically compare that true market value to its appraised value. If the ratio of the evaluation to the actual value exceeds the average ratio by 15%, the evaluation is automatically reduced to the common level. The owner gets his tax relief on the property. But beware! If the relationship between the assessment and the actual value falls below the common level, the County Tax Board is required to increase the assessment to the common level. The homeowner would increase the property tax. If the evaluation falls within the common level range, no adjustment is made.
Each year, on October 1 of the year before taxes, the appraiser establishes a value for each of the properties in the municipality for the following tax year. The annual appraised value is considered tentative during the public inspection period of the new tax list from January 1 to January 10. The purpose of the inspection period is to allow the taxpayer to determine what assessments have been made against them and to consult informally with the appraiser on the accuracy of the assessments.
At this point, your approach may be informal and will not require a formal written appeal. Taxpayers have the opportunity only once a year to file a formal property tax appeal. Obtain your tax form for property tax appeal purposes from the County Tax Board website. Generally, it should be received by the County Tax Board on or before April 1 of the tax year. If the taxpayer misses the deadline to file a formal appeal, the taxpayer must wait until the following year to challenge any tax relief.
The property tax doctor can help the average homeowner get the right property tax break. Under the common level adjustment, described above, the New Jersey legal standard for an acceptable property tax assessment margin of error in your calculation is 15%. In New Jersey, where the average homeowner in 2006 paid about $ 5,000 per year in property taxes, which equates to an acceptable $ 750 error on the property tax bill. If we managed our federal tax bill with that 15% margin of error, we would have a taxpayer revolt.
Gerald Dowgin © 2006