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How to Contest a Property Tax Assessment

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In Maryland, home property tax assessments work on a three year cycle. Every three years your home is evaluated for property tax purposes and you have that one opportunity to contest the new assessment. The schedule for your area may be different but the process is the same. In another year or so, it’ll be our turn to be reassessed and we’re hoping that lowered home prices means lower property taxes.

Maryland also has a Homestead Tax Credit that caps the year over year increase of assessment value to 2-10% (depends on the county). Anything above 10% each year is given as a tax credit so that your cost doesn’t increase more than 2-10% a year. You have to be the owner of the property and live in it as your principal residence to qualify.

So every three years you get the opportunity to contest the property tax assessment and here’s a scenario in which you want your home value to go down. The cheaper they assess your property, the fewer dollars you pay in property taxes. It may make you feel good to learn your home’s value has increased but it hurts your wallet! The only solution is to contest their assessment and here’s how.

How to Contest a Property Tax Assessment

The first step is to read the assessment appeal process for your jurisdiction (here it is for Maryland). Each jurisdiction uses a slightly different process for contesting your assessment. For example, we don’t have to wait until our assigned assessment year to appeal, we can file a petition for review in the two off years. (from here on out we’ll discuss the appeals process in Maryland terms, though your state and county may be similar)

The next step is to collect data from recent sales in the area of similar homes. When a house is appraised, they usually look at recent sales figures or compare it against the values of homes in the area. Then the appraiser makes adjustments based on the unique characteristics of your home, versus the sales listings or comparable homes. You should do something similar in building your case.

Tips for collecting data:

  • Show comparable and recent home sales as well as any circumstances that would lower the value of your home.
  • Look up assessment values of homes in your neighborhood, usually available online.
  • Request the assessment form used by your assessor.
  • Don’t argue over the tax itself, it is irrelevant.

In Maryland, you first present your case to the Supervisor of Assessments. He or she can grant or reject your contest of the property tax assessment. If it is accepted, you’re done. If you are rejected, the next step is to bring your appeal up to the Property Tax Assessment Appeal Board within 30 days of rejection. You’ll present your case again, this time against the assessment office (you can get a list of the properties they consider “comparable” by filing a request).

After this point, if you still don’t get what you like, then you’re getting into the serious judicial system. The Maryland Tax Court is next followed by the actual judiciary system where you’ll likely need legal counsel. If the Appeal Board doesn’t render a favorable decision, I’d probably drop it.

Have you ever contested a property tax assessment? If so, any tips and tricks to share?

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24 Responses to “How to Contest a Property Tax Assessment”

  1. otipoby says:

    I used an appraisal from when I refinanced. It was an independant full appraisal with “comps” and adjustments. I tried to get the appraiser to go lower, but she wouldn’t budge. But, I did take 6% off the valuation of my house. This probably will not translate to a 6% reduction in property tax, but it will be close.

  2. Ron says:

    We didn’t contest the assessment per se, but when our property taxes more than doubled one year, we asked to review our rate card. It had our address, but a neighbor’s information. Somehow, our information had merged with theirs – their home was twice as large, was on a lot 8 times larger, that was expertly landscaped, and had a pool and pool house. The clerk laughed about it saying, “Oh, that happens all the time.” I didn’t think it was too funny.

    • A co-worker of mine had something like this happen with the power company. He lived in an apartment building, and the meters were not tied to the correct apartment. He was getting billed for his neighbor’s usage and his neighbor was getting billed for his.

      My friend was apparently using more electricity than his neighbor, so he would get the lower bill that rightfully belonged to his neighbor.

      If the weather got cold, my friend would crank up the heat. If the weather was warm, he’d crank the AC. As a result, his neighbor would get a higher bill. The befuddled neighbor would attempt to cut usage, and this would drive my frend’s bill lower.

      This really became a vicious cycle. My friend had no financial incentive to cut his power usage. The more power he used, the higher his neighbor’s bill was. The higher the neighbor’s bill was, the more he tried to save. The more he tried to save, the lower my friend’s bill was.

      Finally, the power company caught the glitch and billed my friend for the extra power usage. He tried to get them to cut him some slack, with the logic that if he had realized the cost of the power he was using, he would have been more efficient.

      The friend is from another country where the electric rates aren’t really in line with the US (nor is there as much need for heat in the winter), so he unfortunately didn’t have a baseline to work from to determine that his bills were absurdly low.

      • Anthony says:

        This very same thing happened to me! I was the conversative user, my neighbors were the ones that were unaware.

        I noticed that my bill was ridicously high, around $200 or so. The average for the area was
        around $100. At the time, I was a single guy, worked late hours, and was hardly ever at home. I called the energy company to see what’s going on with the bill, and for months, they weren’t able to help me out.

        On the other hand, my neighbors were a group of 4 or 5 people. They were stuck in a situation where their bill was only ~$80/month, so they kept using electricity like madmen.

        One day, my power gets cutoff. The energy company tells says that I haven’t paid my bill. Long story short, I find out the electricity bills were mixed up, and I got a refund, equivalent to 12-months’ of electricity.

  3. Matt K says:

    Yeah, when I refinanced, I got an official appraisal from someone who took 300 bucks of my money. Is it worth hiring an appraiser to do that if I want to contest, verses just doing it on my own?

    • Jim says:

      I don’t know if getting a $300 appraisal is going to give you a better shot. My guess is that if you can do something similar (data is data) then it should be good enough.

  4. Jim says:

    I didn’t even think about the “mistake” scenario, so it pays to double check this stuff even if you see what you think is an accurate bill.

  5. Anthony says:

    The property tax for my house (1400 sqft, $160k) is about $400. Would it be worth my time and effort (to try) to shrink this?

    • Shrink it to what, exactly? :)

      Very nice …

      • Anthony says:

        Exactly! This is good information to store in the back of my mind. But taxes are so low here, that it would cost more to take action, I think.

    • elloo says:

      gosh, where do you live??? I want that low a tax. Mine is $4200 on 1253 sf.

      • Anthony says:

        I live in Louisiana. I was aware that the property taxes were lower here. But I didn’t realize it was by so much!

        • I live in Iowa, own a home pretty close to yours in value, and pay about 2600/yr.

          • Anthony says:

            Wow! I would really debate homeownership if taxes were so high. When I was in college in Alabama, my apartment’s rent was $3800/yr, not much more than your taxes. LOL.

            Good luck to you, if you try to lower your taxes. Clearly, I will stay right where I am!

        • Matt K says:

          wozers. i’m in md. 1700 square feet. 8k.

    • renea says:

      Wow! What we would give for taxes that low! Our house was $163k last year and we live 20 minutes north of Pittsburgh in a tiny borough. Our taxes are $2,000. And where we moved from in NY, taxes on $120k houses were $3,500.

  6. rctheabsman says:

    Sounds like it would be worth the effort to lower the tax assessment. If the State & County are going to continue to assess your home the same amount in this Economy, but you can’t get that amount when you try to sell your home. The home next door foreclosed for $60k less than our selling price so no one wanted to buy our house. Plan to stick around 5 more years, and hope home values rise again, but plan to fight the next tax assessment even if I have to pay the $300 appraisal with my pension.

    Rick

  7. live green says:

    This happened to my mom and she ended up reducing her taxes by about a $1,000 a year just by contesting her property tax assessment. This has really huge issue over the last few years with the house prices spiking and go right back down.

  8. cdiver says:

    Just as there are limits as to how fast the assesment can go up, does it work the same way for coming back down?

  9. Vic says:

    All is good until they raise the mill rate. Enjoy the savings while you can. The town will eventually get theirs.

  10. Paul says:

    I learned the hard way that it’s very difficult to do this successfully in a condo building. I went through all the appropriate channels and came prepared with comps that really gave me a solid argument and I was told “Well, we don’t see why your condo should be assessed at less than other similar condos in your building”.

    The answer of course was obvious – Not many people know how to fight their assessments or want to give the effort to do so. We were being penalized as a whole because the city knew the majority of tenants would be too apathetic to say anything, and they are using the “we have to treat you equally” excuse. They said they would “consider” my evidence, but I just got a later a week later declining my case anyway (no surprise there).

  11. KEM says:

    I just completed the property tax assessment process for an appeal I filed in 2008, in Maryland. Yes it was a two year process. I received no relief from the Assessment Office; they kindly listen to my information, thanked me for my time and did not change my assessment. So off to the next step the Board, the Board was a little more responsive to my information and reduced by assessment about 15%. Still unsatisfied I went to tax court, without an attorney. The process was somewhat intimidating but doable. I had all the comparable sales for the area, presented my information and received an additional reduction. I found the process favored the State but was worth the time and effort I put forth. So do your homework, know about the sales in your area (the State uses a much larger area that I suspected), hold your head up and you may just prevail.

    • Rick says:

      I am going to the Property Tax Court on NOV. 16th and preparing now, I have 3 cases. I would love to hear from anyone (KEM especially!) who has done this so I can prepare correctly and avoid mistakes. If you can help, please reply and I will post a nospam email address so we can get in touch directly. Thanks.

  12. Diana says:

    I was wondering, if you appeal, is it possible that the state can reassess and your property taxes may actually become higher?


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