Why Every Homeowner Needs a Property Tax Doctor

Because every homeowner who protests their assessments, with a knowledge of how the property tax assessment 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 any tax deductions the homeowner is eligible for.

The property tax doctor can show you how to lower your assessment and therefore lower your property tax bill! The Property Tax Doctor is a former tax adjuster who knows firsthand how difficult it is for the average person to penetrate the bureaucratic jungle of the tax adjuster who understands arcane terms and practices. No government document does this for the home owner.

Just like going to a doctor’s office, the first thing you need 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 of these pieces of information lower their assessment most of the time without going any further than their local tax assessor’s office.

Just as you ask your doctor some informed questions to get some pain relief, you should also ask your tax advisor (with the help of your property tax doctor) some informed questions to get some property tax relief. The best advice the property tax doctor can offer is to go to your local tax assessor’s office and check your property registration card for factual errors! Administrative errors and simple errors occur during the valuation process. Here is a partial list of common errors to check for.

1. The dimensions of your house or the dimensions of your land are wrong.

2. Failing to record depreciation under adverse conditions on the site or failing to show depreciation or minimum depreciation for an older home.

3. The dimensions of your lot are incorrect.

4. Review all the calculations, whether or not you understand where the factors come from.

5. Not taking note of depreciating off-site influences — a factory or landfill that produces toxic fumes.

6. The quality of upgrades is wrong: You have a stone, not a macadam path, or: You have the low-priced hot tub, not the big-name, expensive hot tub.

7 Finished areas are listed incorrectly — basement is shown as finished and it is not.

8. The age of the house is incorrectly indicated or the number of floors is incorrect.

My father wouldn’t let the local tax assessor, who was also his best friend, walk past the kitchen table on our farm. My father was afraid that he would see some improvements in the interior of the house and increase our evaluation. My father mistakenly believed that the improvements he had made to the inside of the farmhouse, such as a new bathroom sink, drywall repairs, wallpaper, new ceilings, new light fixtures, would increase our assessed value. Also, he postponed external repairs until after the next reassessment for fear of further assessment. Surprisingly, he was wrong. Exterior repairs such as roof replacement, masonry repair, porch repair, steps, stairs, etc. do not increase the owner’s assessment. Neither does the replacement of garage doors, sheds, sidewalks, etc.

Often establishing the proper combined property value for your home and the land beneath it is the key to your property tax appeal. To win his appeal, the owner must establish the value of his property at a lower level than the value used by the appraiser.

To establish the market value, the homeowner can go to the website http://www.zillow.com to get a rough estimate of the value of their home. The site uses a few basic variables like square footage, number of bathrooms, acreage, and number of bedrooms to calculate a home’s market value based on a formula that is based on other home sales in the neighborhood. Where zillow has sales data, this is a good first step to see if your home is priced too high.

In the years after the revaluation year, the owner must find out what the relationship between assessment and sales is for his New Jersey taxing district. This ratio is announced each year and is available from your local tax assessor’s office. It represents the average in which the appraisal value of all the properties that were sold in the last year was compared with its sale value in the municipality. Because it is important? You can provide a key factor to show that you have received an unequal assessment and have the right to challenge your property assessment discrimination for a tax reduction.

An unequal appraisal is one made at a higher proportion of the market value than the average of the other parcels in the roll. A year or so after a reassessment, housing inflation often makes the appraisal your tax assessor placed on your home appear low compared to the sales prices of comparable homes sold in your neighborhood. But beware!

A low sale assessment rate in a municipality can fool some taxpayers into thinking they are being assessed below market value and therefore getting a break. However, if all assessments are set below market value, then the tax rate must be increased to raise the necessary amount of tax revenue. The same amount of tax is collected, but taxpayers are tricked into thinking they have gotten relief and are not seeking the misassessments.

Now, don’t forget that the sales assessment rate (or common level rate) is a key factor in getting a property tax break. Let me explain. An important test of the fairness of your assessment is not just its relationship to market value. It is also whether or not it is fair in relation to the evaluations of other properties in your city. For example, if you have a house with a market value of $800,000, but it is assessed at $600,000, you may think you are getting cheap. However, if your neighbor’s house, which is comparable to yours, is appraised at only $200,000, you are paying three times as much property tax as you should!

When your property is under appeal, the County Board of Taxation can adjust the value of your home to the common level. The taxpayer must know the average ratio in the municipality where the property object of the appeal is located before filing a tax appeal. Remember that the ratio changes annually on October 1, for use in the subsequent tax year. Also, remember that this common level adjustment is not used in the year of revaluation or revaluation when all properties have been brought to 100% of market value.

Once the County Board of Taxation determines a property’s true market value, it must automatically compare that true market value to its assessed value. If the ratio between the evaluation and the actual value exceeds the average ratio by 15%, the evaluation is automatically reduced to the common level. The owner gets his property tax relief. But beware! If the ratio of assessed to actual value falls below the common level, the County Board of Taxation is required to raise the assessment to the common level. The homeowner would then get an increase in their property tax. If the evaluation is within the common level range, no adjustment is made.

Each year, on October 1 of the year preceding the tax, the assessor establishes a value for each of the properties in the municipality for the following tax year. The annual appraisal value is considered attempted 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 assessor about the correctness of the assessments.

At this point, your approach can 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. Get your tax form for property tax appeal purposes on the County Board of Taxation website. Generally, it must be received by the County Board of Taxation 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 contest any tax relief.

The Property Tax Doctor can help the average homeowner get the rightful tax relief. Based on the common level adjustment, described above, the New Jersey statutory standard for an acceptable margin of error in property tax assessment 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 error of $750 on the property tax bill. If we administered our Federal Tax bill with that 15% margin of error, we would have a taxpayer revolt.

Gerald Downgin © 2006

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