Why You Should Dispute Your Property Tax Assessment (And How to Do It) - Texas Scorecard

It is interesting how some of us will drive blocks out of our way to save a few cents a gallon on gasoline, yet when we get a major expense like our property taxes many will simply say, “It is what it is.” Part of the problem is that many of us don’t fully understand our options when it comes to property taxes — we don’t know what all they include, what portions can be frozen, or the difference between appraised or market value. None of this should stop you.

The fact is you have the right to protest or dispute your property taxes, and you should. More Texans are. Disputes rose almost 19 percent in 2017 from 2016, and the number is expected to grow.

The Advantages of Challenging a Property Tax Assessment

The biggest advantage of filing a protest is that there are few disadvantages beyond the time and effort required to do it correctly. Homeowners will either get a reduction or a freeze. At the very least, you’ll understand a lot more about property values in your neighborhood and how homes are assessed (potentially handy for a future challenge). The best-case scenario is that a reduction could end up saving you tens of thousands of dollars in the coming years. Your goal is to show your home is not as valuable as what the assessment shows.

Reasons Why the Rate May Be Unnecessarily High

The are several reasons why a home could be assessed at a value that is too high. Perhaps it is in need of repairs or upgrades. It may not be valued with like properties in your neighborhood. There may be new construction in the area that is affecting prices. It is also possible the taxing authority may have just taken the previous year’s value and added a flat percentage increase to it. There is also just the sheer number of properties to be assessed each year. The taxing authority may be painting with too wide of a brush.

How to Go About Challenging the Rate

You should know that there is a small window to dispute your property assessment. That period is 30 days from the time you receive it in the mail. In Texas, that makes the deadline generally on or around May 15th each year.

Before challenging your rate, you should decide if it is worth your effort. In Texas, property taxes tend to be higher than elsewhere in the country — up to 3 percent of a home’s value. That’s why it is oftentimes worth filing a dispute. For example, if your home is assessed at $300,000 your taxes could be as high as $9,000. If you could get that reduced by even 20 percent, that’s $1,800 in the bank.

If the data on your assessment is incorrect, filing should be a no-brainer especially if it works in your favor. If your lot, for example, is 0.4 acres but is listed on your assessment as 4.0 acres, that will make an impact. Check the number of bathrooms, bedrooms, and other data to ensure its accuracy.

You’ll next want to get multiple “comps” of homes similar to yours that have sold in the past year. These are homes that should be of similar age, construction, and square feet; they also should be in your neighborhood or area. A real estate professional may be able to help you get these. You’ll then be able to compare these comps to the value of your home.

You’ll next want to submit your case before the Appraisal Review Board (ARB). If the ARB rejects your claim, you can always submit an appeal.

This is a commentary submitted and published with the author’s permission. If you wish to submit a commentary to the Texas Scorecard, please submit your article to submission@empowertexans.com.