Excerpted from Your First Home: The Smart Way to Get It and Keep It
Proven Strategies to Slash Your Property Tax Bill
Almost everyone hates to pay taxes, and it doesn’t matter whether they’re federal income taxes, state taxes, or local taxes on the house you own.
Americans dread property taxes more than any other tax, according to the Tax Foundation, a Washington, D.C.-based research group.
Not to worry. If you tax bill is particularly onerous – or out of line with what others are paying for similar homes – you can often make a case for why your taxes should be reduced. To slash your property tax bill, try these tried and true techniques
Analyze Your Property Tax Card
As a homeowner, you’re entitled to visit your local tax assessor’s office and request a copy of your property tax card.
This tax card contains detailed data about your house, such as the lot size, the number of bedrooms and bathrooms in your home, as well as information about improvements or upgrades to the house. If you find mistakes in this card, point it out to your tax assessor and request a reevaluation.
That reevaluation could lead to your annual tax bill being lowered.
Know the Tax Implications of Home Additions
Many homeowners want to improve or beautify their houses – or simply make their residences much more livable.
Before you satisfy your hankering for a new pool, an extra bathroom, or even a new storage shed in the backyard, find out how such an addition or structural change would impact your property taxes.
Any permanent structures you build – such as a deck or additional bedroom – will wind up adding to your tax bill.
Compare Neighboring Properties to Your Home
Not only can you get tax information about your home, you can also research your neighbors’ homes. This can be invaluable if you approach a tax assessor’s office to ask for a property tax reduction.
Let’s say you notice that the taxes on your three bedroom, two-bathroom home are higher than all other three-bedroom, two-bath homes in your area. This gives you a factual basis upon which you can make a claim that your taxes are too high.
Deal Honestly With Your Tax Assessor
If you ask for your property bill to be lowered, expect your local municipality to try to schedule an appointment with you for a tax assessor to come inspect your home.
Some people try to dodge the tax inspector, afraid that this person might see nice things in the home or quality amenities, and raise the property taxes.
If you’ve done your homework, and you’re dealing in a forthright manner with the tax man, don’t worry too much about a tax increase.
On the other hand, some cities automatically impose the highest tax rate possible on a home if a property owner refuses to grant the tax assessor access.
So when the tax assessor comes to your house, whether the visit is scheduled or not, graciously welcome the person inside.
Be sure to walk through the home with him or her – pointing out the good and the bad in your house. The tax assessor might note your nice hardwood floors or the granite countertop in your kitchen, but miss the fact that your house doesn’t have new replacement windows or updated appliances.
It’s your job to candidly point out these flaws – without going overboard. Just be matter-of-fact in mentioning your home’s high points, as well as all of its drawbacks.
Keep up With Current Market Values
One big reason that property taxes exploded during the past decade is because home prices escalated so dramatically.
Since skyrocketing home values led to reassessments on the upside, in theory, declining home values can also lead to lower assessments.
Therefore, keep abreast of local market values. If you live in a community or a state where prices have stagnated or fallen substantially, you might be due for a reduction of your property taxes. Just realize that reassessments, (excluding those done when a home is sold), typically lag behind local market conditions.