6 Helpful Ways to Lower a Property Tax Bill
The fast and significant increase in home prices over the last few years has caused property taxes to increase as well. A majority of American homeowners would probably agree that they feel they pay too much money in property taxes. Property taxes are taxes calculated by the local government in which your home is located and paid out by the homeowner. These are considered ad valorem taxes meaning that it is assessed according to the actual fair market value of the property.
The revenue generated from property taxes is most often used to fund local items in the area where you live. This can include items like funding fire departments, law enforcement, public parks and recreation programs, and the school that a child living on the property would attend. These services benefit all residents in the area but property taxes can be a bit of a burden on an individual homeowner. Even after you pay off your mortgage you will be responsible for property taxes. As your home appreciates in value so will the amount you need to pay in property taxes.
You will never be completely free from paying property taxes but there are some helpful things you can do to help lessen the burden of your property tax bill.
6 Helpful Ways to Lower a Property Tax Bill
Know and understand your property taxes
If it feels like you are paying more in property taxes than you should it is important to make sure that you know the exact figure on your bill and how the local government in which you live has arrived at that figure. A majority of homeowners actually just pay their property taxes without understanding how the amount they owe is calculated.
It can get confusing because one city to the next could completely add up property taxes with a different formula. Most often property taxes are calculated by using the tax rate and the current market value of your property. Each city’s tax rate is going to be different depending upon the laws and items voted on to affect the tax rate such as school bonds and levies.
To tabulate the amount each homeowner owes the tax assessor comes to the property or assesses a property remotely through software to come to the fair market value of your specific property and then applies the tax rate to that number. So, if you have a home value of $300,000 and the local property tax rate is 2.5% your property tax responsibility for the year is $7500.
Ask for your particular property tax card
Not many people realize that they are able to visit the town hall of the area they live and request a copy of their property tax cards from the assessor’s office. This card provides a homeowner with information that has been gathered about their property.
A tax card includes information about the size of the property and the precise dimensions of the rooms of the home on the property as well as the number and type of fixtures located within the home on the property. There could be other information included as well such as a special feature section or notes on improvements and renovations.
You want to review every detail of these cards to make sure there are no discrepancies in the information that could be raising issues about the actual market value of your home. This information should be taken to the tax assessor so that they can make corrections and reevaluate. If you find a mistake your local government has an obligation to correct it.
Keep curb appeal simple
Unless you are getting ready to sell your home it is a good idea to keep the exterior of your home inviting but simple. This sounds funny but tax assessors are given a strict set of guidelines when it comes to the evaluation process of the home. More attractive homes often receive higher assessed value than a comparable home with less curb appeal
Your home is being compared to the neighbors during your evaluation as well as others in the general area. Try to keep your home improvements to a minimum until after you know the assessor has finished their evaluation.
Research homes like yours
It has happened before where homes that have the same attributes have been valued at two different price points. It is a good idea to research homes that are just like yours within your neighborhood or just a few streets away and look at their assessed value to see if it is less than yours. This could give you leverage to have the assessor change the fair market value number of your home.
Related: 4 Ways Homeowners Can Save Money in 2022
Look for exemptions
Tax exemptions are not just for nonprofits or government organizations you may qualify for an exemption if you fall within certain categories within your state or local municipality. Some of the most common categories for exemptions include being a senior citizen, being a veteran, being a person with a certain disability, having an agricultural property, or falling under a homestead exemption. It is a good idea to check in with your tax authority to see if you qualify for any exemptions.
Filing an appeal
If you have gone through the other steps and still feel like your tax assessment is more than it should be you can file an appeal for a small filing fee to have someone review the tax and statistics about the assessed value of your property. You want to make sure that you file this appeal in a timely manner otherwise you will be stuck with the bill you receive for that year and have to wait until the next period.
For more information on purchasing real estate in Snohomish County please contact us anytime.
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