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Prepare to fight city hall on property assessments: 6 steps

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in Small Business Tax,Small Business Tax Deduction Strategies

Although the real estate market nationwide hasn’t returned to the “glory days” property taxes are still going through the roof.

Strategy: Appeal a property tax assessment when you have reasonable grounds. The National Taxpayer Union (NTU), an independent advocacy group, says that 60% of property in the United States is overassessed. If your appeal is successful, your property tax bill will be reduced.

But you may have to move quickly. In some areas, you only have 30 days after receiving your current tax bill to initiate an appeal. Here are six practical suggestions.

1.  Verify the dimensions. Examine the property tax notice to see if it overstates your home’s dimensions. If your house has less square footage or fewer rooms than the notice states, chances are it has a lower value, too.

2.  Look for mistakes. Some assessors don’t even look at the property. Instead, they compare descriptions of the home with seemingly similar ones in your neighborhood. Even if the numbers are accurate, it’s possible that your home is overvalued. It could be located near a busy highway or in a flood zone, which lowers its value.

3.  Check the comps. On the other hand, this is often the easiest way to prove that your home is overvalued. Find assessment numbers on homes similar to yours—in terms of size, age and location—at your local assessor’s office or online. Compare at least a half dozen homes to see if most assessed values are lower than yours.

4.  Cut through the red tape. If your assessment seems high for any of those reasons, contact your assessor’s office and arrange a meeting. Bring all relevant information, including photos, data on comps and so on.

5.  Seek an appeal. Don’t automatically concede if you can’t arrange a meeting or it results in no change. You can still lodge a formal appeal with the local assessment board. (Before your appeal, sit in on somebody else’s public hearing to learn how the board works.)

6. Hire a pro. If you don’t have the time or inclination to fight city hall alone, consider hiring a property tax consultant or attorney to do the legwork. Fees may be charged by contingency (e.g., 25%-50% of the amount saved in the first year) or by a flat rate or hourly.

Tip: For more information, you can order NTU’s booklet, How to Fight Property Taxes for $9.95.

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