howardnlby Howard Stephenson
The month of August marks the beginning of Truth-in-Taxation hearings for those taxing entities proposing to increase property taxes. It is also the time when taxpayers can challenge the taxable values of their properties which have been established by county assessors.
Protesting Property Tax Rate Hikes
A large number of local taxing entities have proposed to increase property taxes this year. The list includes 18 of Utah’s 40 school districts, 12 cities, three counties, and eight special taxing districts. The date, time, and location of the Truth-in-Taxation hearings where citizens can speak out are contained on the mailed assessment notices and the ¼ page newspaper advertisements published twice before the hearings. These hearings are critical opportunities for taxpayers to voice their opinions about the level of taxes they can afford and to sound off about government spending.
Some citizens attending these hearings have felt that elected officials have their minds made up before the meetings even begin, but we have seen some taxing entities reduce their tax-hike proposals based on public input. Another value of these hearings is deterrence. Many local governing boards and councils avoid even proposing tax hikes because they don’t like the unsavory experience of hearing citizens publicly criticize their actions.
Appealing Property Valuations
A second way taxpayers can reduce their property taxes is in challenging the market value established by the county assessor. If the property value listed on your notice is higher than what you think your property would sell for, you should appeal to the county board of equalization within 45 days of the date the notice was sent or by the date on the notice. You can hire someone to assist you, get a friend or relative to do the work, or submit an appeal on your own.
Here are the steps to appeal:
Step 1: Obtain a copy of your property tax file from the county assessor and check it for errors. Make sure the property description is accurate. See that the acreage of the lot and the square footage of the building are accurate. Verify the number of rooms and an unfinished space in the building. Errors that would inflate the value of the property should be identified in your appeal.
Step 2: Substantiate the value of your property. This can be done with real estate closing papers, a professional appraisal, or values of recent sales of comparable property obtained through a realtor. Many realtors are willing to provide a computer listing of property sales at no cost in hopes of getting your future business. Those who have had their mortgages refinanced recently can submit that appraisal with their appeal. For those with commercial property, the income approach can be used, which establishes the market value based on its capacity to produce income, such as rental income for an office building.
Step 3: Submit any errors found during Step One, and the value established in Step Two along with your appeal to the board of equalization within the time period indicated on the notice. In larger counties, you will be notified of a specific date and time for your appeal after you submit your request. In smaller counties, you appeal may be heard at the same time your request is made.
Some counties allow taxpayers to mail their appeals and some of these may be decided without a formal hearing. While attendance at the hearing is not required in all counties, we would highly recommend it, as the taxpayer has the responsibility to present the burden of proof. When in attendance you can explain why your comparable properties are more appropriate than the assessor’s and answer questions about your property and comparables.
Step 4: The Hearing: There will be three parties at the hearing: a representative of the county assessor, a neutral arbitrator appointed by the county, and you or someone you select to represent you. It is up to you to show why your property is not worth what the assessor says it is worth.
This is not the time to complain about high taxes (that’s what Truth-in-Taxation hearings are for). The only appropriate matter to be considered is the value of your property.
The assessor’s representative will show why he feels the property is worth what is shown on the notice. You will have the opportunity to ask questions or make comments about the assessor’s information. If the assessor’s office is not present, his case should not be assumed correct or defended by the impartial hearing officer. If this happens during your appeal, your evidence should be given greater weight. Please let me know if the hearing officer is not impartial and gives the county assessor’s values undue weight.
Step 5: If you are unhappy with the decision of the board of equalization, you may appeal to the State Tax Commission through the county auditors’ office. However, you have only 30 days from the date of the board of equalization’s decision to make the appeal. The Tax Commission will review the record of the hearing, including your information and if findings of the board of equalization. You will be first allowed an informal arbitration forum in which a hearing judge will mediate to see if some common ground can be found and an agreement can be reached. Failing that, you will be given a formal hearing. In both of these settings parties can present the Board of Equalization evidence and add new evidence if they choose.
Step 6: If you are not satisfied with the decision by the Tax Commission, you may appeal through the courts. Once again, an appeal must be filed with the District Court within 30 days of the date of the Tax Commission’s decision.
Please let me know if you have problems or concerns about your experience at Truth-in-Taxation hearings or in appealing your property taxes. The process is intended to be citizen-friendly. And nobody should be paying more property taxes than they legally owe.