How to Effectively Appeal Your Property Tax Assessment

Disclaimer: The following information represents The Tim Sova Team’s Best Good Faith Opinion on Michigan Property Tax Appeals. Appealing your property taxes may result in your local government Assessor’s Office physically visiting your property. In some cases, property owners have had their property values increased as the result of an Appeal. In some cases, your State Equalized Value (SEV) may be decreased without a corresponding Taxable Value (TV) decrease. All information must be independently verified. Source listed below article.

First

Read and understand:

A Guide to Your Property Taxes Proposal “A” (2009 Information)

Note: Foreclosure Purchasers, read BULLETIN NO. 6 AUGUST 15, 2007 FORECLOSURE GUIDELINES

Second

Questions to answer before asking for an Appeal of your Michigan Property Tax Assessment:

Did you purchase your property prior to 2000?

In many cases, property values have dropped to 2000 values (or below). Property Owners purchasing after this date, may automatically receive their entitled decrease in Taxable Value.

Were there any major renovations performed on your property?

In some cases, local Assessor’s Offices have not reviewed all properties for improvements. Your property may have additional items not currently assessed that actually increase the property value.

Were there any Personal Items included in your purchase transaction?

Some real estate purchases include transfer of appliances or even vehicles with the transaction. To the best of our knowledge, these items should not be included with your assessment.

Third

Get the Facts and Gather Information before the March Local Board of Reviews

After receiving your Notice of Assessment, Taxable Value, and Property Classification notice, go to the Assessor’s Office and obtain a copy of your property worksheet or appraisal card. Verify information about your property is correct (number of bedrooms, baths, stories, style, living area square feet, etc. Ask them to explain all abbreviations and information. *We suggest writing this down, you may forget before March.

If, blatant errors are found, like an additional bedroom recorded, additional story on home recorded, additional acres for property (not tenths of an acre), then see if they will correct your worksheet or if you need to provide proof. Ask what documents you need to provide as proof. Also, inquire as to what dates are included for property sales should you decide to include those as proof.

Next, verify your Taxable Value did not exceed 0.997 percent (see reference below). If so, ask them to show you where they got the inflation rate. For those property owners who owned since 1995, your Taxable Value should be capped at 5.0 percent above 2009. Verify the value does not exceed 5 percent. If so, ask them to explain any difference. Both your SEV and TV can be appealed at the Local Board of Review, but only a decrease in Taxable Value will lower your taxes.

Does your Notice of Assessment, Taxable Value, and Property Classification include the correct Homestead Percentage? If this is your primary residence, your homestead should indicate 100 percent exempt. If zero is indicated, then you may not have filed your Principal Residence Affidavit and should call your local Assessor’s Office to submit this form and inquire about any refunds for prior years.

Foreclosure and Investment Property purchasers, please verify the “percent good” indicated on your property worksheet or appraisal card. If there is excessive interior or exterior property damage, you may be able to use this to decrease your property value. Ask them, what proof you will need to provide to Appeal your State Equalized Value and Taxable Value. In some cases, you may be required to complete repairs within a specified period of time, so make sure you check your local government requirements before making an appeal.

Location, Location, Location… If your property is located near a major freeway, landfill, or industrial area, the location may decrease your property value. The Tim Sova Team may provide facts that similar homes are assessed at a lower value.

The Tim Sova Team can verify sale prices of recently sold properties. Providing factual information about Comparable Properties that either sold or were Assessed lower than your property may be the leverage you need to have your property value decreased, thereby decreasing your taxes.

The Tim Sova Team offers a unique market analysis package. This package includes a Comparable Market Analysis (CMA) that compares properties similar to yours and determines what homes have sold for in your neighborhood recently. To ensure accuracy, the CMA is prepared after visiting with you in your home and considering exterior/interior features.

Following the visit, we can then decide which limiting factors (if any) should be considered and included in the report, specifically any items that would affect your home’s value. The cost for this professional CMA is $50.00 and will be delivered within 3 days after doing a walk-through of your property.

Visit www.TimSova.com to request a professional CMA (click here)

In some cases, a professional Appraisal of your property by a State of Michigan licensed appraiser may be required. Make sure to contact your local Assessor’s Office to explain all your options.

Fourth

Presenting Your Case

When presenting your facts to the local Board of Review, keep in mind there will be a very small time limit. Usually around 5 minutes. Organize all your “facts” and make a copy for each Board Member. Your local Assessor’s Office will provide you with the number of members. Information should be placed into a letter form with attachments. A sample letter is available on How to Effectively Appeal Your Property Tax Assessment

If you are not satisfied with results at the local Board of Review level, you are allowed to appeal to the Michigan Tax Tribunal. Information requirements and timeline are available at your local Assessor’s Office.

Source:

Based upon How to Effectively Appeal Your Property Tax Assessment brochure available from each Michigan legislator. Brochure example provided above.

Inflation Rate Multiplier for use in the 2010 capped value formula and the 2010

“Headlee” Millage Reduction Fraction (MRF) formula interpreted as .997 percent for 2010

State Senate Candidate Joe Hune Invites Public to Informational Meeting on:

“How to Appeal Your Property Tax Assessment”

State Senate Candidate Joe Hune is inviting all residents of Livingston, Shiawassee and Southern Ingham Counties to attend this informational meeting that will help to explain “How to Appeal Your Property Tax Assessment.”

Joe Hune has invited an expert in property tax law to address the public at this informational meeting that will take place on Tuesday, February 23, at 7:00 p.m. The meeting will take place at Cleary University Johnson Center at 3725 Cleary Drive in Howell.

“There will be a thorough explanation of the process of property tax assessing and an opportunity for residents to ask questions,” said Hune, R-Hamburg Township . “I know that many folks feel overwhelmed when they receive their property tax statements in the mail and I hope that we may be able to help them save some money in the long run.”

The Rogers Report
How To Effectively Appeal Your Property Taxes

February 2010

In This Issue

KEY DEFINITIONS

HOW TO EFFECTIVELY APPEAL YOUR PROPERTY TAX ASSESSMENT(S)

SAMPLE LETTER

STRATEGY

ASSESSORS OF THE 66TH DISTRICT

NOT SATISFIED?

Dear Tim,

It is likely that as a property owner you have received notice of your 2010 property tax assessment(s).

I am writing to remind you that you have the right to appeal your assessment to your local board of review in March, if you believe it is inaccurate (your notice will include the exact meeting time and location.)

This newsletter is a step-by-step guide to help you review your assessment(s) to ensure accuracy and educate you in the appeals process. I have included the phone number of area assessors if you want to contact them to arrange an appointment. You should be prepared to make your case to the board using about five minutes or less.

Please Note: You must appeal your property taxes before the local board of review in order to take your case before the Michigan Tax Tribunal.

Many homeowners have noticed that for the past several years, property values have been falling but property taxes keep going up. This is due to a quirk in current law that allows a home’s taxable value to go up each year by whichever is lower – the rate of inflation or five percent – regardless of changes to market value.

This year, please note that nearly every homeowner should see a slight property tax decrease of 0.3 percent. This decrease is only because our economy is so weak that we actually have a negative inflation rate.

It is my honor and privilege to serve as your State Representative. If you ever have any questions, comments or concerns, please do not hesitate to contact me.

Sincerely,

Bill Rogers

State Representative

66th District of Michigan

KEY DEFINITIONS

TRUE CASE VALUE (TCV)

The actual value of your home, as determined by the local assessor.

STATE EQUALIZED VALUE (SEV)

50 percent of the actual value of your home.

TAXABLE VALUE

The capped value of your home. By law, increases in your taxable value that are not due to improvements are limited to the rate of inflation or 5 percent – whichever is lower. Taxable value cannot exceed SEV.

BOARD OF REVIEW

A panel of local citizens appointed to review, correct and approve the assessment roll.

ASSESSOR’S OFFICE

The department within the local unit of government that establishes and adjusts assessments for every parcel of property in your community.

HOW TO EFFECTIVELY APPEAL YOUR PROPERTY TAX ASSESSMENT(S)

STEP 1 – OBTAIN A COPY OF YOUR PROPERTY TAX WORKSHEET OR APPRAISAL CARD.

This is available from the local assessor’s office. The worksheet lists information such as size of the house, style, number of baths, etc. Ask the assessing department to fully explain how to read the document.

You may also obtain worksheets for similar properties which recently sold in the area to help determine the value.

STEP 2 – CAREFULLY CHECK THE WORKSHEET FOR ERRORS.

If you notice any errors, the assessor may agree to change some of the information or figures at that time. If not, you will have to make your case with the board of review.

Your worksheet may include a “percent good” calculation which shows how much your home has depreciated. For example, a 10-year-old house may be listed as 90 percent good. Percent good is another factor to use when comparing your home to other homes (see Step 4).

STEP 3 – MAKE SURE YOUR TAXABLE VALUE HAS DECREASED BY 0.3 PERCENT.

Because the weak economy has resulted in a negative inflation rate, your home’s taxable value should decrease by 0.3 percent from last year (assuming you did not make any improvements to your home.) Taxable value should not be confused with state equalized value, which always equals 50 percent of your property’s true cash value.

STEP 4 – INSPECT THE INSIDE OF YOUR HOME.

As noted in Step 2, the “percent good” is the way an assessor depreciates the value of a home based on its age, meaning normal issues common to older homes are not considered in the specifics of the assessment. However, problems not associated with general aging, such as a cracked foundation or wall construction problems, should be specifically addressed in your appeal.

Written repair estimates and photographs of structural damage are good evidence of defects which could affect property value.

STEP 5 – NOTE CHANGES TO YOUR NEIGHBORHOOD.

Realtors say location is the single most important feature in determining the value of your home. If you live near a major road or a mixed-use zoning area, for example, your home may be less desirable than the same home in a purely residential neighborhood.

If the characteristics of your neighborhood have changed, obtain copies of citizen complaints about excessive noise of eyesores and show this evidence to the board.

STEP 6 – IF YOU RECENTLY PURCHASED OR REFINANCED YOUR HOME, DETERMINE WHETHER YOUR PURCHASE PRICE OR YOUR APPRAISAL IS LOWER THAN YOUR ASSESSMENT.

Providing this documentation to the board of review does not guarantee a lower assessment, but it will help strengthen your case.

STEP 7 – INFORM YOUR ASSESSOR ABOUT PERSONAL PROPERTY INCLUDED IN THE SALE PRICE OF YOUR HOME.

One of the most common mistakes home buyers can make is to fail to inform the assessor of personal property and other valuable items included in the sale. Personal property items often included in a home’s sale price, such as furniture, curtains, a washer or dryer, etc., are exempt from assessment.

If you did not inform your assessor in writing about these items, your assessment may erroneously include this value.

STEP 8 – COMPARE YOUR PROPERTY TO SIMILAR HOMES IN THE AREA, ESPECIALLY THOSE THAT RECENTLY SOLD.

Comparable property assessments are one of the most important tools when appealing your property tax assessment(s). If comparable properties are assessed lower than yours, your home may be over-assessed. Check the assessed value, type of house and zoning.

Compare the true cash value per square foot. Keep in mind that comparisons should only be made between similar types of homes (compare two stories with two stories, ranch houses with other ranch houses).

STEP 9 – PUT ALL YOUR INFORMATION INTO LETTER FORM.

See sample appeal letter below.

SAMPLE APPEAL LETTER

Date

Name, Address, Telephone Number

To the Board of Review/Tax Tribunal:

I wish to appeal my property tax assessment for the following reasons:

1. According to my worksheet/property records, I have noted the following discrepancies:

A. I do not have a fireplace as indicated.

Estimated Value………………………………………………….$1,800

B. I do not have a tile bath as indicated.

Estimated Value………………………………………………….$1,200

C. According to my worksheet I have 1,500 square feet of living space. I actually have 1,000 square feet.

Reduced Value……………………………………………………$1,800

This amount should be deducted from TCV………………..$9,920

2. I have noted the following structural defects on my property. They reduce the value of the property by the following amounts.

A. Cracked foundation……………………………………………….$3,800

B. Cracked exterior wall……………………………………………. $2,200

This amount should be deducted from TCV………………..$6,000

3. I live in an area that has mixed zoning and next door there is a new junkyard which emits loud noises and noxious odors. This affects the value of my property. I feel my true cash value has been reduced by………………………………………….$3,000

3a. Grand Total, add 1, 2, and 3 above………………………$18,920

4. I wish to make the following comparisons:

231 Main Street, assess value _______________ (List all comparable and ask for an average reduction. Also, add all items you noted as discrepancies.)

Example:

True Cash Value……………………………………………………$60,000

Minus Discrepancy/Grand Total……………………………….$18,920

New True Cash Value…………………………………………….$41,080

One-Half = Assessed Value (SEV)…………………………….$20,540

NOTE: This sample letter indicates many of the grounds for reduced assessment(s). It is very unlikely that an assessment could be reduced by nearly one-third, as illustrated here, but every reduction is important.

STRATEGY

Bring a presentation copy for yourself and each member of the board of review. You may only have five minutes, so make your points, show photographs and above all, remain professional.

ASSESSORS OF THE 66TH DISTRICT

City of Brighton: (810) 225-8024

Brighton Township: (810) 229-0558

Genoa Township: (810) 227-5225 ex: 19

Green Oak Township: (810) 231-1333

Marion Township: (517) 546-1588

Oceola Township: (517) 546-3259

Milford Township: (248) 685-8731

NOT SATISFIED?

If you are not satisfied with the decision of your local board of review, you may continue your appeal.

In order to appeal the decision the local board of review made, you must send a letter or formal petition to the Michigan Tax Tribunal, P.O. Box 30232, Lansing, MI 48909, on or before July 31. Petition forms are available on the tax tribunal’s website at michigan.gov/taxtrib.

If you send a letter, the tribunal will mail you the necessary forms to fill out. You should contact the tribunal at (517) 373-3003 for additional information regarding letter and petition requirements.

Source: February Newsletter from Representative Bill Rogers

Property Tax Assessment Info

How to Effectively Appeal Your Property Tax Assessment

Tim Sova

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