Saving Money on Property Tax Reassessment

The amount of property tax you pay every year is determined by how much your property is worth. The property you own is assessed and given a value, and the government uses that value to determine the amount of taxes you owe by taking the fair market value of your property and multiplying it by the amount of the current tax rate. Property tax, or real tax, is typically calculated and issued against the value of real estate. There are, however, other forms of property tax, for instance, personal property tax. These taxes are typically both charged and assessed in separate amounts from the regular property tax, mainly because they tax items like cars, motor homes, or boats. If you are hoping to save money on property tax, it is important to understand the rules and to understand the principles of reassessment.

Property Tax Due Dates

When you receive your property tax fee, you typically have that year to pay the entire balance, and the entire amount is often sectioned into installment payments.

• These payments could be due in quarterly installments, which is most common in cases of commercial property.
  
• Typically with private properties, such as homes, vacation properties, or hunting lands, the payments are due on a monthly basis.
  
• These monthly charges can often be added to mortgage payments to ensure timely satisfaction of the tax liability.

In general, the money you pay every year in property tax is spent in the community you live in. Your local government controls how your property taxes are spent, and the money is typically used to pay government expenses covering things such as emergency staff, paramedics and police, fire department, and the funding of local court functions. Your property tax dollars also help finance local parks, recreation programs in your community, the upkeep of local streets and sidewalks and most importantly, the local school system.

How Reassessment Can Help You

Having a reassessment performed on your property is a bit of a double-edged sword.

• On one hand, most often a reassessment isn't ordered unless something you've done to your property adds a significant value to it. Things like major improvements or additions on existing homes or having a home built on an otherwise empty lot will almost always cause the local government to come and reassess your property, and since those improvements will increase the value of your property, your property tax liability will increase as well.
  
• However, if property values decline locally, you may want to have your property reassessed because, in most cases, natural flux in property values won't require a reassessment. You may, however, ask for a reassessment if you think the value of your property has declined enough that it would change your tax liability, thereby decreasing the amount of property tax you pay.

Costs of Reassessment

Exercise caution when ordering a reassessment, as many independent assessment firms charge much higher fees than your local government In most places, the local government will reassess your property at little to no charge.

Getting Help

If you are thinking about having your property taxes re-assessed to save money, be sure to consult with a local real estate or tax attorney first. Your lawyer can help you understand the process and predict what outcome is likely after a reassessment.