There is little else in life that sends a shudder through homeowners then the anticipation of what their next property tax bill will state. In some areas of the country, a significant amount of tax revenue is on the backs of personal property owners making this tax the number one burden for homeowners. Do you understand your taxes? If not, you should as your lack of knowledge could cost you thousands of dollars.
In many locales, property taxes are due on a quarterly, semi-annually, or annual basis. The higher your tax burden, the more likely that a municipality will allow you to determine how often payments may be made. In some areas of the country, the state legislature makes that determination.
When your tax bill is due, it is quite frankly: due. In many cases you are given up to ten days after the due date to make payment, but going beyond that means your taxes are in arrears and you will face penalties and interest charges. Let this go on too long and the municipality could place a lien on your home, even force you into foreclosure. That is one reason why most locales require you to make monthly property tax payments with your mortgage payment. In addition, you could be required to carry an escrow amount to cover your upcoming property taxes. In this situation, the mortgage company will send payment to your municipality on your behalf.
Should your home be under construction, then the taxes you are paying will be estimated by the municipality. Once construction has been completed a corrected copy of your tax bill will be sent to you. If there is a shortage involved, you may be required to write out a check on the spot for the shortfall or spread that amount over the next several months up to one year.
If there is an error with your property taxes or you believe you are paying too much, you must follow the procedures listed on the bill to respond accordingly. If there are no instructions given, simply call the phone number on your invoice to speak with a clerk in the tax office. You may be able to speak with the tax collector who can go over your bill with you. If there is still a disagreement, you can protest your bill formally and go through a court hearing to air your case. If you lose, you will be expected to pay whatever charges have been levied.
If you disagree with the appraisal district's value or any action of the appraisal district about your property, the Texas Property Tax Code (TPTC) provides several options to appeal your property taxes. Most appraisal district offices will meet with you informally to review your protest and usually make an offer, but if you are unsatisfied with the offer, you can protest at an Appraisal Review Board (ARB) hearing. However, if you do not achieve a satisfactory reduction at the ARB hearing, the TPTC provides you with the opportunity to protest by requesting either binding arbitration or judicial appeal.
Once the ARB rules on a property tax protest, it sends a written order by certified mail. If you are dissatisfied with the ARB's findings, you have the right to appeal its decision in district court in the county where the property is located. Before filing, you should consult with an attorney to determine if the case is a good one. Within 45 days of receiving the notice of determination from the ARB, you must file a petition for review with the district court. You must make a partial payment of taxes-usually the amount of taxes that are not in dispute-before the delinquency date. Judicial appeals are an effective and essential tool in appealing property taxes.
Unfortunately, judicial appeals are not financially feasible for most homeowners. Filing fees alone are about $300. It would cost about $2,000-$5,000 for a homeowner to pursue judicial appeal. The expense is simply too much compared to the possible tax savings for the average homeowner. (For example, based on a median home value of $150,000, a 3% tax rate and a 10% reduction, a homeowner could save $450 during a judicial appeal.)
Homeowners with an assessed value from $750,000 to $1million or higher may be able to hire a consultant or an attorney on a contingency basis. It is possible to appeal on either unequal appraisal or market value using a judicial appeal, unlike binding arbitration where you can only protest on market value. In addition to the high costs to have a judicial appeal, the process is also more formal and time-consuming than binding arbitration.
Questions? E-mail O'Connor & Associates, or call 1-877-4-TAXCUT.
Both Joseph Hanoa & Patrick C. O Connor are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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