With the run of real estate prices, the unsung “hero” in that growth is the value of YOUR home! Fortunately, that is great news for the value of your investment. BUT, hold on, this is the season that real estate tax bills go out. Rising real estate prices may well result in a rising property tax bill. Every 1-5 years, depending on location, the value of the land and any buildings on a property is reassessed for its market value. New property tax amounts are then calculated based on the new assessed value of your home.
Take a look at your property value. If you aren’t sure your property valuation is accurate, or it hasn’t been recently reassessed you can challenge it. A property owner typically has 90 days after a new assessment to appeal, although in some places it’s as little as 30 days. Most property assessment notices are mailed at the beginning of the year. Often, this request can only be made during the first quarter of the year, so don’t delay.
The first step is to research the appeals process for your locality. Next, request your property tax card, which lists the information your property assessment, is based on, like the number of rooms, and improvements. Check to see that these details are accurate and up to date. If there are any discrepancies, you likely have grounds for a reassessment. If the info is correct but you still feel your valuation is wrong, you can still appeal but it will take some more work. Research will be necessary to back up your argument. Usually, this involves finding other similar properties in the area for value comparisons. There are also professionals who do private appraisals and comparison research on your behalf for a fee. The final step is to present your case to your property tax assessor. More importantly, most of the municipalities only accept and review these challenges in the first quarter of every year.
Even if your property valuation is set in stone there are still ways to reduce the burden on your wallet. First, make sure you are receiving all the tax breaks you may qualify for, especially the homestead exemption. This tax break is available in most areas for properties on which the owner makes their primary residence. In some states, there are deductions available for certain groups like seniors, or in some areas farmers. Despite the limitations, don’t forget that property taxes can be used as an itemized deduction on your tax return. Don’t let those rising property taxes bring you down. Rising real estate valuations in your area is a good thing, but that doesn’t mean you shouldn’t seek out opportunities to ease the impact on your budget.
Associates of Bluestone Wealth Partners are registered representatives of Lincoln Financial Advisors. Securities and advisory services offered through Lincoln Financial Advisors Corp., a broker/dealer (Member SIPC) and registered investment advisor. Insurance offered through Lincoln affiliates and other fine companies. Bluestone Wealth Partners is not an affiliate of Lincoln Financial Advisors. CRN-2948550-021120