Studies consistently show that 25 percent of U.S. property owners are paying more property tax than what is required by law. It doesn’t always result in lower taxes, but there are situations where appeals are accepted by your county for reassessment.

What’s a Tax Appeal

The tax agency can sometimes make mistakes. Property taxes are based on assessed value, which means the agency will look into the value of the property, residential or commercial, location, and improvements before coming out with an assessment.

Unfortunately, this appeal process can take some time. Of course, you have to realize that every request for reassessment can turn the other way and the assessor may find reason to increase rather than decrease the tax.

Starting the Appeals Process

It always starts with going over your tax assessment letter. This is the letter you get in the mail from your local government. Property taxes are charged every year, and you have the option of paying annually or in partial payments.

When you receive your assessment letter, you must go over it carefully. Compare the previous year’s assessment with the current one to determine if there has been an increase. If your property size has not increased, the tax rate should be the same. That is, unless the government has passed a law regarding new property tax rates.

Property tax is computed by taking the assessed value and multiplying by the local rate. The tax rate of each city can vary.

It is best to submit a request for reassessment immediately. If you check the back page of your letter, you will find the procedure for challenging your assessment. If there is none, call or visit your local tax office, or you can consult with a tax lawyer.

However, before you take that step toward a tax appeal, consider the following:

  • Check the data. There could be a mistake in the figures or numbers. If there is an error, an appeal would not be necessary. You could just show proof that there is a mistake in the computation.
  • Determine if the savings on a long-term basis or year-over-year is worth the cost of an appeal.
  • Talk to a local Realtor. He or she would know the value of properties similar to yours and give an honest assessment – for a minimal fee.

Finally, ask for clarification. Most assessors are willing to discuss tax rates. And if you are given an appointment for reassessment, be on time and bring all your supporting documents.