How to Cut Your Property Taxes
As a home owner, you have the secure feeling of knowing that you are building equity each year. But you also have unpleasant property taxes to pay, that increase along with your home’s value. No matter how you look at it, paying taxes is never fun, but reducing your tax bill can be very satisfying. Here are a few steps you can take:
- Find out if your state offers any rebates to home owners. If you meet all of the requirements of a home owner you are entitled to at least one form of rebate.
- If you buy property jointly with a family member or partner, both of you will be eligible for a tax rebate. You will usually need to apply rebates when filing your state income tax.
- Make sure that your property assessment is correct and in line with those of other homes in your area. You can do this by speaking to your neighbors, contacting a realtor and reviewing market value records.
- You have the right to determine if there are any errors, miscalculations or false assumptions in your assessment. To avoid paying excess taxes, you need to submit an appeal if you disagree with the assessment. The bank’s appraisal of your home is the best evidence you can use to support your case. The good new is that about 50% of appeals are decided in favor of the taxpayer.
- Typical assessment errors can include a screened-in porch that is considered to be usable all year, over-estimated square footage, or half-bathroom counted as a full bath. Note, your town or county assessment procedures can be found online.
- See if you have taken every exemption that the law allows by checking with a real estate professional or an accountant in your area. You can also visit the National Taxpayer Union’s website (http://www.ntu.org). This advocacy group tells us that from 30% to 60% of all property assessments are above market value.
- Think about using a property tax consultant to check your tax assessment. This professional will go over the “fine print” that you may have missed and make sure the assessments are correct. Some consultants charge a percentage of what you will save on your taxes, while others charge a flat fee for this service.
- Ask your mortgage provider if you are eligible for a refund of the property taxes you have already paid. Your mortgage agreement may include an automatic escrow account for your taxes.
- Remember that having your tax assessment lowered by as little as 10% can result in a satisfying tax savings when you get your next tax bill. We think it is well worth the time and effort you will put into taking action.