Here at Alex R. Hernandez Jr., Business Law, we often handle disputes raised by homeowners about their property taxes. When mistakes are made on your property tax assessment, you can end up paying more than you need to. As your real estate lawyers serving Corpus Christi and the surrounding areas, our goal is to help you file property tax protests to ensure you’re not overpaying on your taxes. Keep reading to learn more about property taxes in Texas and how a tax lawyer can help you appeal unfair tax bills.
What Are Property Taxes?
Property taxes are ad valorem taxes, meaning the amount is calculated based on an assessed value of a transaction or physical property. Property taxes are paid annually by homeowners and property owners and are used to fund local programs and essential systems. These funds can go toward everything from schools and libraries to the salaries of your local government staff. They also pay for your local fire department, police department, and other public servants, as well as improvements to roads, sewers, and other important factors that benefit the community as a whole.
How Are Property Taxes Calculated?
Property taxes are determined by your local government. Some states are known for having very high property tax rates, such as New Jersey and Illinois, whereas other states have historically low property tax rates, like Hawaii and Alabama. In fact, property taxes can vary so much from state to state, that many people consider the property tax rate before moving to a new state. For example, the average homeowner in Alabama pays $780 per year in property taxes, whereas the average homeowner in New Jersey pays a whopping $8,480 in property taxes each year. Often times low property tax rates are coupled with higher sales and income taxes, so the residents still pull their weight in taxes, it just depends when and on what they pay them.
In Texas, the average property tax rate is currently about 1.86%, which is higher than the national average of 1.19%. This tax rates can vary from county to county, but most homeowners are not worried about what the next county over is paying, but rather how big their property tax bill will be this year and whether or not they will need to call a real estate tax lawyer for help. Your property tax bill is calculated based on the assessed value of your property multiplied by the tax rate.
What Happens When Your Property Taxes Are Too High?
The taxable value of your home is dependent upon assessment by your local tax office. Depending on your local laws, property assessments might be done yearly or every five years. These assessments are based on a number of factors, but typically it is dependent on local comparisons. For example, if your next door neighbor just sold their house that is practically identical to yours for $200,000, then a tax assessor might value your home the same.
However, sometimes issues arise when you receive an assessed property value that seems too high. After all, the higher the assessed value, the more you pay out of pocket. If you find any of the below issues on your property assessment or tax bill, be sure to reach out to a real estate tax lawyer for additional guidance.
Reasons Why A Property Might Be Wrongly Assessed
Sometimes properties are valued more than they should be because of an honest mistake. Perhaps there was some miscommunication at one point or another that led a property assessor to believe your home has four bedrooms instead of three. Or maybe you recently sold a big chunk of your land but your home is still being valued as if it’s sitting on 10 acres.
You might also find a larger than expected tax bill due to issues you’re experiencing with your house that would not be apparent based on neighborhood comparisons. For example, if your neighbor did a total renovation of their home before they sold it and your home has not been updated for decades, that can greatly skew the value. Your home might also experience nuisances like a sinking foundation, water damage, or lots of wear and tear.
Another possibility for high assessments is when a tax break you are entitled to is not fulfilled. Texas offers reduced property taxes if you meet requirements that qualify you for a monetary exemption from your total assessed property value. Some of these include exemptions for disabled veterans, spouses of disabled or deceased veterans, senior citizens, solar or wind-powered energy usage, charitable organizations, and residence homesteads. You can learn more about Texas property tax exemptions here.
Finally, perhaps there are no obvious mistakes on your property assessment, but you discover that similar homes (or even nicer homes) are being assessed lower than yours, meaning they are paying less in property taxes.
What To Do About High Property Taxes
The first thing to do when you notice discrepancies on your tax bill is to act quickly. Most local governments have an appeals process with a strict deadline. Start by calling your local tax office and informing them of the issue. From there they will be able to point you in the right direction.
It is likely that the tax assessor made an honest mistake and your high property value isn’t a personal attack. However, even honest mistakes can go ignored during the busy tax season. It is important that your concerns be heard and taken seriously, and when they are not, it is time to call on the help of a real estate lawyer who can present your case for an appeal.
File A Property Tax Protest With Our Tax Lawyers
The team at Alex R. Hernandez Jr., Business Law is here to help you with your property tax protests. We can file your appeal, represent you at appraisal reviews, and perform other services to handle your tax protests. Get in touch today to speak with a professional about your property tax protest!