Don't Mess With Taxes

When Donald J. Trump gets back from his first trip abroad as president, he's going to come home to something all homeowners dread. There's a problem at the house.

OK, with Trump we have to ask which house?

While there's plenty going on and going wrong in Washington, D.C., right now, I'm talking about the abode 45 calls the Winter White House, otherwise known as Mar-a-Lago.

One of the views of Ma-a-Lago showcased on the private club's website.

A sinkhole opened up this week in the street outside his landmark Palm Beach, Florida mansion.

Traffic alert first: The news of the cavity first appeared, according to the Washington Post, in a routine traffic advisory on May 22:

"A 4' x 4' sinkhole has formed on Southern Boulevard directly in front of Mar-a-Lago. It appears to be in the vicinity of the newly installed water main. West Palm Beach Utilities distribution crews have secured the area and will most likely need to do some exploratory excavation today."

The work crews arrived, did a little work and retreated when the sinkhole started growing. At last report is was a 10-by-6 foot sinkhole.

Check out my Tumbling Taxes blog for a video (from another West Palm Beach TV station) of the sinkhole. Exciting!

Palm Beach officials said they weren't sure if traffic would be affected moving in or out of Mar-a-Lago, but asked that drivers use caution.

No kidding!

Speaking of kidding, the internet of course erupted with its own snarky analysis of and metaphors about the hole outside the Trump estate. Full disclosure: I might have mentioned Buffy Summers and the Hellmouth on Twitter. All in good fun, people, all in good fun.

Tax value appeal issues: Then I stopped chuckling and got to thinking about what I would do if such a thing happened outside my house.

My first thought was how soon I could get Austin road crews out to fix it. Then I thought of how such a phenomenon might affect the property's value, for future sale as well as current tax assessments.

Naturally, that got me wondering whether the sinkhole might affect Trump's Palm Beach County real estate taxes.

While the hole isn't on his property proper, it sure doesn't make for good curb appeal. And one of the 7 steps to take when appealing the assessed value of your property, which is used to establish your eventual tax bill, is to highlight your home's flaws. (Quick aside: I've resurrected this property tax appeal post for featuring as today's Weekly Tax Tip.)

Yes, it seems counter-intuitive, but when you can show appraisal officials any disrepair on your property it can help lower your homes tax-setting value. And this nay-saying isn't limited to the structure itself.

Negative influences surrounding your property also can be evidence that the appraised value is too high. This includes things like busy streets, a water tower looming over your home, that nearby sewer plant, or a growing sinkhole in the road in front of your property.

Trump's tax fights: Can Trump, or more likely his many people who take care of his properties and his taxes, use the asphalt opening? Maybe.

While the Trump family maintains private quarters in a separate, closed-off area of the house and grounds, Mar-a-Lago is an expansive and expensive private club, making it a commercial property.

As such, it faces Florida's non-homestead property tax treatment with its 10 percent cap on value increases from year to year. But a cap won't help that much when your property is estimated to be worth between $200 million and $300 million.

So Trump's tax experts are probably looking for anything that can lower the Palm Beach County property taxes on the historic estate once owned by cereal heiress Marjorie Merriweather Post.

His tax folks are, after all, quite practiced at appealing tax bills assessed his golf properties.

Take, for example, the one in Briarcliff Manor, New York, where they sought a 90 percent reduction. That situation is tied up in, you guessed it, lawsuits.

And even when you appeal, it's not always successful, even for The Donald. Last week, Miami-Dade County officials denied Trump's request for a nearly $1.8 million property tax break on his Doral golf resort.

It was the fifth year in a row that Trump's far South Florida club had appealed its property tax assessment. The four previous appeals were successful.

Regardless of the outcome, every property owner has the right to go through the appeals process to ensure that their tax bills are correct, even the president.

If the sinkhole helps, then so be it.

Be careful, though: But being the worrier that I am, even if the over-sized pothole got me a lower property tax bill I'd still be concerned about it.

Part of my fretting is because for decades I've been tracking the growth of two sinkholes near my West Texas hometown.

The first Wink/Kermit abyss formed almost 37 years ago (June 3, 1980) and has grown from a 110-meter-across, 34-meter-deep hole to one that's 94-to-117 meters across. And those measurements were taken 13 years ago. I'm still searching for its current size.

The nearby second Permian Basin sinkhole showed up on May 21, 2002. This newer one has expanded from its original surface width of 137 meters to an oval shape with widths ranging from 185 to 250 meters.

So good luck, Mr. President, if you do find some property tax use for the sinkhole. But you also might want to keep an eye on that stretch of road, just in case.

You also might find these items of interest:

• Trump relinquishes NYC property tax
• Tax differences between home repairs & home improvements
• Mitt Romney's lower taxes extend beyond IRS to California property tax bills