Don't Mess With Taxes

It's property appraisal time here in Central Texas. That means my social media feeds are filled with property tax complaints.

I am right there with my neighbors in being upset with how much the Travis Country appraiser thinks our house is worth.

Higher value = higher tax bill: On the one hand, it's nice to see how our humble abode has appreciated since we moved in almost 10 years ago.

But on the other hand -- and this is the hand that counts since we're not selling any time soon -- I am definitely not happy with the assessment that could result in a projected $1,000-plus increase in our eventual annual real estate bill. 

Travis County, however, has a different perspective. In fact, when county officials sent us our 2015 appraisal notice, they included a note congratulating us.

OK, it was it celebrating the county's new online system with which we can protest our appraisal amount. But still, the notice's tone struck me as a bit too joyous.

Here's the message, complete with the appraisal office's exuberant punctuation, that appears below that image of a happy laptop:

Congratulations, your property is eligible for eFile!!!

File your protest online and we'll review your protest, check the evidence, and potentially make you a settlement offer over the internet. No traffic. No waiting in line. You get to keep all of your tax savings.

Of course, those tax savings only materialize if you can convince your county appraiser that he/she messed up in evaluating your property.

Property appraisal protest steps: So how do you do that? The protest processes in counties across the country all are different, but they do share some common issues.

Here are five general steps to take in filing a property appraisal protest.

1. Know the deadlines.
Your appraisal notice should include the date by which a protest must be filed. Miss it and you're automatically out of luck.

2. Assess your assessment.
Understand how your local officials determine your property's assessment. An appraiser might compare your property with similar, recently sold properties to determine its market value, then multiply that by a set fraction, known as the assessment ratio.

Some tax districts have a lag time between appraisals, maybe only evaluating property every few years and estimating in the off years. The residential real estate market is volatile and home values can fall or jump a lot in very short times.

Another method is essentially estimating the cost of replacing a house and then adjusting the valuation for factors such as the land value. You need to be working from the same basis as your appraiser in preparing your protest.

3. Spy on your neighbors.
Really, it's OK in this instance. (I'm going to try this excuse reasoning the next time the hubby gives me the side-eye for showing inordinate interest in what our neighbors are doing.)

You need to know what similar residences in your neighbor are worth. Check online. Even better, find a friendly real estate agent and see what local homes are selling for. You'll want properties that are around the same square footage, lot size, amenities, etc.

Look for houses where owners have improved the residence and lot more than you have. Those more valuable homes are likely the reason that your appraisal went up. 

And also search out houses similar to yours in your neighborhood that are valued less than yours. When it comes to appraisals, you want to be down there with them.

4. Highlight your home's flaws.
This is counter-intuitive for most homeowners, but if you can show appraisal officials any disrepair on your property -- aren't you glad now that your spouse ignored your nagging reminders about fixing up the back yard? -- it can help lower your appraisal.

Also note "negative influences" surrounding your property as evidence that the appraised value is too high. These could be busy streets, a water tower looming over your home, that nearby sewer plant, or commercial property bordering your community.

Unfortunately, your annoying neighbor's jalopy up on blocks in his overgrown front yard probably will not help here.

5. Get professional help. 
Don't have time to do all the property appraisal protest homework? Consider hiring a firm that specialized in protests. But be careful.

While there are legitimate third-party property protest experts, there also are less-than-professional entities. Talk to neighbors and friends who had success with a professional protest firm. Then, even with recommendations, carefully check out any company you hire. 

Also realize that what you save in time will be countered by what you must pay for the protest help. Most firms charge a percentage, ranging from 15 percent to 50 percent of the tax savings you get that first year.

There also could be fees simply to get the appeals process going, as well as any amount you might owe if the protest professional isn't successful.

Some homeowners try a combination approach. They protest their property assessments themselves and if they're denied relief, they go to a pro for help in appealing the unsatisfactory result.

6. Be professional.
It is infuriating to overpay any taxes, especially so when you're talking about a bill as big as your home's appraisal might produce. But don't let that outrage control your efforts to lower your potential tax bill.

Do your homework and know you have a solid value ready to present to the appraiser, one which is supported by the evidence you have prepared. Making an online offer or going into an appraisal hearing without knowing what the lower value should be and why it's justified indicates to the appraiser that you simply are unhappy with the valuation and expecting your complaints to get results.

7. Be patient.
If you don't get quick online property appraisal relief, it's not the end. But realize that in-person protests and subsequent appeals can take time.

Yes, appealing a property appraisal is a pain, like many homeownership responsibilities.

But if your property is truly over-valued, it's worth the effort to reduce that number so that your annual property tax bill will be accurate and more tolerable.

You also might find these items of interest:

• $42 million Montana mansion owner loses property tax fight
• Lowest U.S. property tax bill? Probably $2 in coastal Georgia 
• Property taxes pose burdens, predatory loan possibilities