The DuPree Team knows that most homeowners would love to learn of how to reduce their property tax burden. Property taxes are real estate taxes calculated by local governments and are considered ad valorem, which means they are assessed according to the value of your property. Although they serve a beneficial purpose for all residents, these taxes can be extremely burdensome for homeowners. They tend to rise steadily over time and, even once you pay off your mortgage. While you may never be free from a property tax bill while you own a home, there may be some relief. Homeowners can use a few simple tricks to lessen the pain of paying these taxes and the burden they bring.
Understand Your Tax Bill
If you feel you are paying too much, it's important to know how your municipality reaches that figure on your bill. Property taxes are calculated using two very important figures—the tax rate and the current market value of your property. The rate at which taxing authorities reset their tax rates is based on state law—some change them annually, while others do so in different increments, such as once every five years. Municipalities set their tax rates—also known as millage or mill rate—based on what they feel they need to pay for important services. An assessor, hired by the local government, estimates the market value of your property—which includes both the land and structure—after which you receive an assessment. The assessor may come to your property, but in some cases, an assessor may complete property assessments remotely using software with updated tax rolls. Your property tax bill, which is based on this assessment, is then sent to you by your local tax collector's office. In order to come up with your tax bill, your tax office multiplies the tax rate by the assessed value. So, if your property is assessed at $300,000 and your local government sets your tax rate at 2.5%, your annual tax bill will be $7,500.
Ask for Your Property Tax Card
Few homeowners realize they can go down to the town hall and request a copy of their property tax cards from the local assessor's office. This card includes information about the size of the lot, the precise dimensions of the rooms, and the number and type of fixtures located within the home. Other information may include a section on special features or notations about any improvements made to the existing structure. Review this card, note any discrepancies and raise these issues with the tax assessor. The assessor will either make the correction and/or conduct a re-evaluation.
Any structural changes to a home or property will increase your tax bill. A deck, a pool, a large shed, or any other permanent fixture added to your home is presumed to increase its value. Homeowners should investigate how much of an increase a new addition means to their property tax bill prior to construction.
Limit Curb Appeal
Tax assessors are given a strict set of guidelines to go by when it comes to the actual evaluation process. However, the assessment still contains a certain amount of subjectivity. This means more attractive homes often receive a higher assessed value than comparable houses that are less physically appealing.
Look for Exemptions
Exemptions don't just apply to religious or government organizations. You may qualify for an exemption if you fall into certain categories. Some states and municipalities lower the tax burden for:
- People with certain abilities
- Agriculture properties
- Save our Homes
Check with your taxing authority to see if you qualify for an exemption. Here is a link to more information about the exemptions available to Florida homeowners. Florida Dept. Of Revenue
Appeal Your Tax Bill
If you've done all you can and haven't managed to get your tax assessment office to see things your way, don't fret. You still have another option available: The tax appeal. Filing a tax appeal may cost you a small filing fee, which is paid to have someone review your appeal. The tax appeal generally requires the help of a lawyer. Your attorney will likely charge you a fee—sometimes a portion of the savings on your tax bill if your appeal is approved. Your appeal should be filed in a timely manner, otherwise you're stuck with the bill you receive from your local tax office.
Your lawyer will go through the steps of the appeal and what information is required. In some cases, you may need to take photos and provide details on the current condition of your property. The board will then review this information, compare it to the most recent assessment and tax bill, and make a decision. You may hear something instantly, or it could take a few months for the reviewer to come up with a decision. If the board approves your appeal, it will only lower the assessment on your home—not your effective tax rate. Although you will still be taxed at the same rate, it will result in a reduction on your tax bill. The appeal process is not a guarantee that your bill will drop. It may remain the same or, in rare cases, it may increase if the reviewer feels your assessment is too low.
The DuPree Team hopes that you and your family have a successful year and are so happy to have you as part of our real estate family. We hope that you found this information useful and look forward to providing you with curated and informative email blogs on a monthly basis. If there is any topic you think we should cover, please let us know! Please keep us in mind the next time you or anyone you know is looking to buy or sell in South Florida.
Visit us on Facebook and leave a review of our services if you like!