Many counties in Pennsylvania, including Delaware, Bucks, Chester and Montgomery counties, have established August 1 as the deadline for you to appeal the following year's real estate assessment. The assessment is what is used to calculate your property tax bills; if the assessment is too high, you will pay too much.
Accordingly, August 1, 2013 is the deadline for filing an appeal of your 2014 taxes in many counties.
As I have mentioned before, you should not appeal your taxes unless you are confident that your assessment is too high. In many cases, properties are actually underassessed. Often, it is new construction, or houses built in the last few years, that are overassessed.
Since you probably just received your school tax bill, take a look at the assessed value that is listed on that bill. Multiply the assessment by the common level ratio for your county. (For 2014, it is 9.09 for Bucks County, 1.66 for Chester County, 1.35 for Delaware County and 1.58 for Montgomery County). If the number seems to be more than you could get if you were to sell your property, you should consider an assessment appeal - either contact an attorney who handles assessment appeals, or else go the the Board of Assessment Appeals for your county for the forms and further details.
Showing posts with label assessment appeal. Show all posts
Showing posts with label assessment appeal. Show all posts
Wednesday, July 10, 2013
Thursday, March 14, 2013
2014 assessment appeals
Since we are now in mid-March, people who live in Pennsylvania and own their own homes or other real estate should do a reality check to see whether they are paying too much in real estate taxes because their property is overassessed.
In order to complete this check, you need the following:
1. A copy of one of this year's tax bills that includes the assessed value of your property.
2. At least a rough idea of what your house or property is worth.
3. The common level ratio factor that applies to the county in which your house or property is located.
The common level ratio factor is based on a ratio that is determined annually by Pennsylvania's State Tax Equalization Board. It is supposed to represent the ratio of the assessed value to the actual value of the property.
To check of your assessment, multiply the assessed value of your property by the common level ratio factor that applies to your county. Pennsylvania's common level ratio factors can be found at http://www.portal.state.pa.us/portal/server.pt/community/realty_transfer_tax/11417/common_level_ratios/580584.
For Delaware County, for 2014, it is 1.39; for Chester County, it is 1.70; for Montgomery County, it is 1.61; and for Bucks County it is 9.26.
If the math gives you a number that is significantly higher than the actual value of your house or property (what it would sell for), you should consider filing a tax appeal.
In many counties in Southeastern Pennsylvania, the deadline for filing a tax appeal of your 2014 assessment is August 1, 2013. If you miss this deadline, you will have to wait another year. You should check with your county's Board of Assessment Appeals to confirm the deadlines, or consult a lawyer who handles real estate tax appeals.
In order to complete this check, you need the following:
1. A copy of one of this year's tax bills that includes the assessed value of your property.
2. At least a rough idea of what your house or property is worth.
3. The common level ratio factor that applies to the county in which your house or property is located.
The common level ratio factor is based on a ratio that is determined annually by Pennsylvania's State Tax Equalization Board. It is supposed to represent the ratio of the assessed value to the actual value of the property.
To check of your assessment, multiply the assessed value of your property by the common level ratio factor that applies to your county. Pennsylvania's common level ratio factors can be found at http://www.portal.state.pa.us/portal/server.pt/community/realty_transfer_tax/11417/common_level_ratios/580584.
For Delaware County, for 2014, it is 1.39; for Chester County, it is 1.70; for Montgomery County, it is 1.61; and for Bucks County it is 9.26.
If the math gives you a number that is significantly higher than the actual value of your house or property (what it would sell for), you should consider filing a tax appeal.
In many counties in Southeastern Pennsylvania, the deadline for filing a tax appeal of your 2014 assessment is August 1, 2013. If you miss this deadline, you will have to wait another year. You should check with your county's Board of Assessment Appeals to confirm the deadlines, or consult a lawyer who handles real estate tax appeals.
Friday, February 1, 2013
Property taxes on new construction may be too high
Recently, I have been called by a number of people who have just received their assessment after buying a newly built house. The assessments that they are receiving will often lead to high tax bills.
When a new house or other building is completed, the local Board of Assessment will issue what is called an "interim assessment" for that property. Depending upon the county in which the property is located, the assessment should represent a percentage of the combined value of the real estate and the building; the percentage is determined by that county's common level ratio. (The common level ratios for Pennsylvania counties can be found by clicking here).
You typically have 40 days to appeal an interim assessment; if you miss that deadline, you are stuck with that assessment until you can next file an appeal of the annual assessment.
In many cases, the interim assessment is correct since it is based on the purchase price contained in the deed that was filed when you bought the house. However, there are times that the ratio has not been correctly applied and the assessment is too high.
Where it can become difficult for the Board of Assessment to correctly the value the property is when the real estate is purchased, and there is a separate contract for the construction of the house. The construction contract is not filed as a public record, and the Board of Assessment thus does not know how much it cost to build. It thus may put too high a value on the house, inflating your assessment and, thereby, your property taxes.
I thus recommend that any time you get an interim assessment, you carefully review the assessed value to confirm whether it is appropriate.
When a new house or other building is completed, the local Board of Assessment will issue what is called an "interim assessment" for that property. Depending upon the county in which the property is located, the assessment should represent a percentage of the combined value of the real estate and the building; the percentage is determined by that county's common level ratio. (The common level ratios for Pennsylvania counties can be found by clicking here).
You typically have 40 days to appeal an interim assessment; if you miss that deadline, you are stuck with that assessment until you can next file an appeal of the annual assessment.
In many cases, the interim assessment is correct since it is based on the purchase price contained in the deed that was filed when you bought the house. However, there are times that the ratio has not been correctly applied and the assessment is too high.
Where it can become difficult for the Board of Assessment to correctly the value the property is when the real estate is purchased, and there is a separate contract for the construction of the house. The construction contract is not filed as a public record, and the Board of Assessment thus does not know how much it cost to build. It thus may put too high a value on the house, inflating your assessment and, thereby, your property taxes.
I thus recommend that any time you get an interim assessment, you carefully review the assessed value to confirm whether it is appropriate.
Tuesday, September 18, 2012
Impact of property sale on your assessment
As I noted in a prior post, the county's assessment of your property (which you can find on your tax bill) should be a percentage of its actual value. The percentage is determined by the common level ratio for the county in which the property is located. The common level ratios for Pennsylvania counties can be found by clicking here.
An ideal time to evaluate your assessment is immediately after you purchase a new home or other property. If the purchase was an arms-length transaction, the price you paid is probably the actual value of that property, or very close to it. If you multiply the assessed value by the applicable common level ratio (percentage), you should end up with a number around the purchase price.
If you multiply the assessed value by the common level ratio and get a result that is significantly higher than your purchase price, the property is likely over-assessed, which means that you are probably paying too much in real estate taxes. You should thus consider filing a tax appeal.
For example, let's say you just bought a house in Chester County for $520,000 that is assessed at $400,000. The present common level ratio for Chester County is 1.70. When the assessment of $400,000 is multiplied by 1.70, it yields a value $680,000 - far more than the $520,000 that you paid. The property would thus be overassessed.
Note that if you are appealing your annual assessment (in other words, if you are challenging an assessment that has been in place for a while, rather than one that was set following renovations or new construction), your appeal applies to the following calendar year. Thus, in 2012, you could appeal your assessment for the 2013 tax year.
If you think your property is overassessed, you may wish to contact an attorney experienced in handling real estate tax appeals. You always want to make certain that you are careful about filing an appeal since it opens up the assessment of the property to scrutiny and, in a worst case scenario, could result in your assessment (and thus your taxes) being increased.
An ideal time to evaluate your assessment is immediately after you purchase a new home or other property. If the purchase was an arms-length transaction, the price you paid is probably the actual value of that property, or very close to it. If you multiply the assessed value by the applicable common level ratio (percentage), you should end up with a number around the purchase price.
If you multiply the assessed value by the common level ratio and get a result that is significantly higher than your purchase price, the property is likely over-assessed, which means that you are probably paying too much in real estate taxes. You should thus consider filing a tax appeal.
For example, let's say you just bought a house in Chester County for $520,000 that is assessed at $400,000. The present common level ratio for Chester County is 1.70. When the assessment of $400,000 is multiplied by 1.70, it yields a value $680,000 - far more than the $520,000 that you paid. The property would thus be overassessed.
Note that if you are appealing your annual assessment (in other words, if you are challenging an assessment that has been in place for a while, rather than one that was set following renovations or new construction), your appeal applies to the following calendar year. Thus, in 2012, you could appeal your assessment for the 2013 tax year.
If you think your property is overassessed, you may wish to contact an attorney experienced in handling real estate tax appeals. You always want to make certain that you are careful about filing an appeal since it opens up the assessment of the property to scrutiny and, in a worst case scenario, could result in your assessment (and thus your taxes) being increased.
Tuesday, December 6, 2011
What your assessment should represent
A key element in the amount of your property tax is your assessment. When your assessment is multiplied by the applicable millage rates, you get the amount of your tax bill.
You should not confuse your assessment with the actual value of your property. In most counties in Pennsylvania, your assessment represents only a percentage of what is ostensibly the actual value (fair market value) of your property. The percentage that applies is called the common level ratio. Because many counties do not regularly reassess the value of the properties in that county, the common level ratio is intended to address changes in property value that occur between assessments.
You can find the common level ratio for your county by going to the State Tax Equalization Board - click here for the webpage that will let you find the common level ratio for your county.
Thus, if your property is worth $400,000, and the applicable common level ratio is 64.2, your assessment should be $256,800.
Please feel free to email me by clicking Email Me.
You should not confuse your assessment with the actual value of your property. In most counties in Pennsylvania, your assessment represents only a percentage of what is ostensibly the actual value (fair market value) of your property. The percentage that applies is called the common level ratio. Because many counties do not regularly reassess the value of the properties in that county, the common level ratio is intended to address changes in property value that occur between assessments.
You can find the common level ratio for your county by going to the State Tax Equalization Board - click here for the webpage that will let you find the common level ratio for your county.
Thus, if your property is worth $400,000, and the applicable common level ratio is 64.2, your assessment should be $256,800.
Please feel free to email me by clicking Email Me.
Tuesday, November 29, 2011
An initial step to take before deciding to file a tax appeal
Last week, I noted that there are two common situations (an overvalued property, or a catastrophic loss) in which you may wish to consider filing an appeal of your property taxes in Pennsylvania. In either case, there are some things that you must do before filing an appeal.
Particularly with a valuation appeal, it is critical that you do not file if you do not have a good chance of winning since, when you file a valuation appeal, the Board of Assessment can actually increase your assessment if it determines that your property is underassessed (assessed at less than its fair market value).
Before you file a tax appeal for a catastrophic loss, you must first determine if the damage to your property is more than 50% of its value. If your house burns down, the answer is obvious. However, if a tree falls through the roof, damaging one or two rooms, the answer is not so clear.
Similarly, with a valuation appeal, you must determine the fair market value of the property before deciding to appeal.
Particularly with a valuation appeal, it is critical that you do not file if you do not have a good chance of winning since, when you file a valuation appeal, the Board of Assessment can actually increase your assessment if it determines that your property is underassessed (assessed at less than its fair market value).
Before you file a tax appeal for a catastrophic loss, you must first determine if the damage to your property is more than 50% of its value. If your house burns down, the answer is obvious. However, if a tree falls through the roof, damaging one or two rooms, the answer is not so clear.
Similarly, with a valuation appeal, you must determine the fair market value of the property before deciding to appeal.
Wednesday, November 23, 2011
Want to pay less in real estate taxes?
In Pennsylvania, your real estate taxes are calculated by multiplying your assessed value (set by your county's Board of Assessment) by the millage rates that applies for your local governmental entities (depending on the county, the municipality, the county and the school district).
You can lower your tax bill by filing a successful property tax appeal.
Generally, you should consider filing a property tax appeal if:
1. The value of your property has dropped; or
2. The building on your property (whether it is your home or a commercial building your own) has been substantially damaged by a fire, flood or similar casualty, decreasing its value by 50% or more.
You can find more information on assessment appeals on our website by clicking here
I'll be posting more details and considerations.
You can lower your tax bill by filing a successful property tax appeal.
Generally, you should consider filing a property tax appeal if:
1. The value of your property has dropped; or
2. The building on your property (whether it is your home or a commercial building your own) has been substantially damaged by a fire, flood or similar casualty, decreasing its value by 50% or more.
You can find more information on assessment appeals on our website by clicking here
I'll be posting more details and considerations.
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