As federal, state, and municipal debt continues to increase at unprecedented rates, governing bodies are constantly exploring ways to generate more income to fund their expenditures. Real Estate taxes are a large source of revenue generation. Therefore, if there is a way to increase your taxes, a governing body will have no issues taking advantage of the opportunity. The following are a few tips for how to decrease your real estate taxes.
1. Consult / Retain an Attorney Who Practices Property Tax Law - Seek referrals from your trusted sources for the contact information of a property tax attorney. The attorney will have the experience necessary to discover a strong argument and file a property tax appeal. It is common for the attorney to charge a small fee upfront, as well as a percentage (22 – 50%) of the reduction if the appeal is successful.
2. Pay your Property Taxes on Time – Be sure to pay your property taxes on time. Some counties do not allow you to move forward with an appeal if your taxes are not paid by the due date.
3. Identify your Appeal Dates – In order to appeal your taxes, you will need to file the necessary documentation by a specific deadline. Appeal windows vary depending on state and county. Know these dates so you do not miss the opportunity to file your appeal.
4. Determine How Your Property is Assessed – Again, this is county and state specific. Knowing how often your property is assessed and how long your news assessment stays in place is critical. Reference your county’s tax portal or website to obtain clarification.
5. Review the Assessor Record for your Property – Each county keeps a record on the characteristics of your property. This record is public and contains the property type, use, age, building square footage, total square footage(land), bedrooms, bathrooms, etc. Review the record for any errors. If the information is incorrect, it could increase the assessor’s value.
6. Find Comparable Properties – All property records in your county are public. When determining whether you have an argument for an appeal, review the comparable properties located with a few miles of your property. Look for properties with similar characteristics and compare the assessed values. If there are discrepancies in assessed values, you will have enough evidence to file your appeal.
7. Take Advantage of Exemptions – Depending on the property’s use (primary residence, second home, investment property) and the county in which it is located you may be eligible for tax exemptions. Know your states exemptions and take advantage of these savings. For Illinois’s Cook County, the following are examples of the exemptions that they provide: Homeowner, Senior Citizen, Senior Freeze, Home Improvement, Returning Veterans’, Disabled Veterans’, and Disabled Persons’.
It is in your best interest to know everything about your locality’s real estate tax code and the strategies you can take to make sure you are not over taxed.