Homeownership has its perks. However, most homeowners would probably agree, the rising cost of property taxes isn’t one of them. If you think your property taxes are too high, you’ll be glad to know you don’t have to accept your bill the way it is. You can appeal your property taxes, and if you’re successful, enjoy the advantages of owning a home in your town or city while paying less for the privilege.
How Are Property Taxes Calculated?
Property taxes are determined according to the value of your property. They’re commonly known as a type of ad valorem tax, since ad valorem is Latin for “according to the value.”
“Property taxes are calculated by applying a taxing district’s tax rate to the assessed property value,” Tom Parrish, retail lending director at BMO Harris Bank in Elmhurst, Illinois, told The Balance by email. “For example, in DuPage County, IL, outside of Chicago, assessed values are required by law to be based upon the three prior years of actual sales transactions within the jurisdiction, which would mean the 2020 assessed value would have been based on sales occurring during the 2017, 2018 and 2019 calendar years.”
Property taxes vary greatly by state and even county. Some property tax regions have low rates, while they’re much higher in other areas. For example, property taxes are highest in New Jersey (2.2%) and lowest in Hawaii (0.37%), according to ATTOM Data Solutions. The average American homeowner pays a tax rate of 1.1%.
There’s no wiggle room in your municipality’s tax rate, but if you believe your home has been assessed for more than its value, you can negotiate to try to get that number reduced.
Before You Appeal Your Property Taxes
Your city or town sends you an assessment notice every year. You might receive that document on its own, or it may be part of your property tax bill. If you think there’s been an error in how your property taxes are calculated, you can appeal it, but you’ll need proof that the number from the assessor is incorrect. “The best evidence to support an adjustment in your assessed value is a recent appraisal, a recent sale of the property, or recent sales of similar properties in your neighborhood,” Parrish said. “Look at comparable properties in your area to learn about property taxes for properties that are similar to your home—including the same design, size, or other features.”
Review the Numbers
For starters, check your property record, which you can find at your local tax assessor's office. Make sure all the information about your home is accurate, including the number of bedrooms and bathrooms, square footage, and other distinguishing features. If any of the details in your property record are wrong—for instance, it lists a two-car garage instead of a one-car garage—you can use these errors to make the case that your home’s value has been overassessed.
Compare Your Property to Others
You can further support your argument by looking at comparable properties that recently sold in your area. If four houses in a three-block radius sold for between $250,000-$275,000, and your similar home was assessed at $325,000, you can use that data to prove that it was valued incorrectly.
Comparing your property to surrounding properties can give you a sense of how much tax you should be paying. Besides the neighborhood, Parrish said there are many other characteristics that contribute to the assessed value, including, “Living area square footage; property age; exterior construction; total land square footage; number of bedrooms and bathrooms; basement square footage and the percent finished; amenities such as a pool; interior finish quality; whether air conditioning is installed; fireplaces; patios/decks; and a garage and the size of it.”
File an Appeal and Ask for a New Assessment
So, what if you’ve evaluated your property record and comparable properties in your neighborhood and you still believe that your assessment is wrong? You can appeal and ask for a new one. “File an appeal with your county assessor’s office,” Parrish said. “Refer to your local county assessor for details on how and when you are required to file your appeal.”
In Cook County, Illinois, for example, you can file an appeal online by following these steps:
- Provide an email address to create an account.
- Make note of the appeal docket number you’re given, which you can use to track the appeal.
- Include any relevant attachments with your appeal, such as an appraisal or photos of the property. Cook County also gives you a free tool to locate and attach comparable properties in your appeal.
- File your appeal within 30 days after receiving your reassessment notice. If you miss the deadline, you’ll have to wait until the following year to file an appeal.
- You can also hire a property tax attorney to handle the appeal. If you choose this route, keep in mind that you’ll need to pay them a fee, and there’s no guarantee that the outcome will be in your favor.
When you receive your assessment, act quickly, before the window of opportunity to appeal that year expires.
Some municipalities charge a fee to file a property tax appeal, but it varies by location; your local county assessor’s office will likely have applicable fees listed on its website.
In addition, depending on where you live, your appeal may be settled by mail, or you may have to attend a hearing to present it to a judge. In that case, you’ll need to decide if it’s worth your time, and possibly lost wages if you need to take a day off work, to appeal your property taxes in person.
There are no guarantees your property tax bill will go down. It may stay the same, or, in some cases, even increase if the person reviewing your appeal thinks your property assessment should be higher.
Your Options After the Assessment
So, what happens if you still don’t agree with the new assessment you receive after the appeal? According to Parrish, you have two options. "The first would be to hire an attorney who specializes in property tax appeals to try and escalate it further,” he said.
The second option might be to make sure your rationale for the original appeal is sufficient and has proper support to justify the change (e.g., you’ve had a recent appraisal and you’re able to establish a clear comparison with properties similar to yours), and then challenge the existing comparable properties that the county is leveraging to determine your property value, he said.
Frequently Asked Questions
When will I receive my property tax appeals results?
That will depend on the assessor’s office; however, even if you file by email, results are usually sent by postal mail.
Do I need to hire an attorney to appeal my property taxes? How much does it cost?
You can file an appeal online yourself free of charge. If you choose to hire an attorney, the cost varies.
If I win a property tax appeal, when does it change my mortgage payment?
If you win a property tax appeal, you won’t notice an immediate change. Again, specifics may vary by county or state. In Cook County, for example, a reassessment received in 2021 would be reflected on the 2022 tax bill. However, it is also possible that the appeal could find that your home’s valuation has increased, so you might end up paying more in property taxes.