As this time of year approaches, the reality of tax season starts to set in. While property taxes are not paid until closer to the end of the year, it’s never too early to be analyzing your situation and what you can do to minimize your burden come November (which is when you’ll receive the largest discount for paying early).
Each individual’s property taxes depend on a variety of factors, but ultimately it comes down to your local property appraiser and the assessment they assign to your property. While there are state guidelines for the calculations they come up with, in many circumstances the assessment is up to their discretion. Additionally, you might be paying higher taxes than your neighbor with an identical property. For condos, we have found large discrepancies between various units within the same building. While it’s normal for higher floors to be valued an additional $3k – $5k per floor in the open market, we have found instances at the ICON South Beach where the increase in value assessment is as high as $16k per floor.
Thankfully, these assessments are not written in stone and there is something you can do about it. To have your assessed value reconsidered, you must petition the Value Adjustment Board (VAB)– and this must be done prior to your official tax bill arriving in early November. In Miami, property owners will begin receiving correspondence in the early fall – this is what is known as a TRIM notice. You will receive an explanation of how your property tax will be calculated and is usually denoted at the top with THIS IS NOT A BILL. This is not the official bill, but this is the time you should begin to consider your appeal.
One of the most straightforward and likely guaranteed ways to receive a reduction is if you notice an error in the assessment. If you are being assessed for a home with four bedrooms and three baths and you only have three bedrooms and two and a half baths, this should be brought to the attention of the VAB and will likely result in a lower tax bill.
If there are no glaring mistakes you can do a number of things to determine if you’ll have a fighting chance at reduction. First, look at the county records, available online at http://www.miamidade.gov/pa/property_search.asp. You can review your home as well as those around you and determine if you are being unfairly assessed higher than other similar units in your building or neighborhood. Though assessments are generally lower than the real fair-market-value of your property, you can also note current and recent sales of similar properties – if they are less than you are being assessed, you have a strong case to petition. Similarly, you can also have your property appraised (at your own cost) and present those numbers for review.
Another step you can take, which recently is becoming more popular in Miami, is to discuss these assessments with your neighbors or association. Though the original purchase price does factor in, which can vary greatly depending on the year that you purchased your property, the properties should be assessed similarly. In Miami, there are numerous law firms that specialize in property taxes that are taking in groups of clients that all reside in the same building or community. By working with a collective group, these lawyers have been able to petition the board on behalf of their clients to successfully lower assessments given their broad knowledge of situations facing multiple properties. Taking advantage of this strategy generally does not cost you unless the law firm is successful in lowering your value, and at that point, you will pay them typically 50 percent of the savings.
Due to the Trump administration’s changes in the tax code, it’s expected for there to be an increase in property owners who choose to petition their assessments this year. Unless you have made significant improvements or additions to your home that are not noted on your TRIM, it’s much less likely that your taxes will go up as a result of a petition, so why not give it a try!
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