You read everywhere that housing values are dropping, yet your property taxes haven't budged. The fact is, government taxing agencies seldom reach out to homeowners and tell them to send less. In a climate where revenues that fund public services are declining, don't expect the government to make the first move to lower your taxes.
As a homeowner, you do have the right to appeal the amount of your property tax if you think it is unfair or incorrect. To make this happen in Colorado, you must file a petition with the County Tax Assessor's office within 30 days of when your tax notice was mailed to you. Most people do this right after they have received a "notice of value" letter, which comes out every two years in May. The County Assessor will turn your case over to a Board of Review, which will consider your case, based on the documentation you have provided.
There are three basic scenarios where your petition is likely to be resolved in your favor:
- When the home is sold and you can clearly show that the selling price was lower than in the past
- When there has been property damage
- When neighborhood housing values have fallen, which puts homes in the area at a lower valuethan in the past
The first two cases are easier to prove than the last one. What taxpayers often don't realize is that the assessor bases his valuations on past pricing, not current values. In Denver, current tax assessments are based on sale prices of homes between January 1, 2007 - June 30, 2008. To make a case that your home is valued too high, you would need to provide documentation about home sales in your neighborhood in that time frame. Even if the property has taken a nose dive in the past year, the county won't consider any fall off in value if it occurred after the cutoff date. Actual 2009 sales prices in Denver metro neighborhoods won't be reflected on tax statements until 2011.
What's interesting to note is there is a time lag for tax value increases too. If area property values have gone up or if you have made improvements to your property that come to the attention of the assessor, you won't see the increase on your bill for a year or two.
What you'll need to prove your case to the review board are market comparisons and sales prices, information that a local real estate agent will have. You can also hire an appraiser. If you have pictures that show damage to your home or conditions in your neighborhood that might affect the value of your home, these might help you state your case.
Check the assessor's report that lists the features of your home that are included in the tax valuation. If things that you don't have are included - like extra bedrooms, extra bathrooms, a finished basement, a deck, or a garage - you could provide the appraisal report along with pictures or floor plans to clarify what your home includes. The review board is composed of people familiar with the area, so they should be tuned into factors like foreclosure rates, rising crime rates, and widespread storm damage. Along with your individual circumstances, they will take these factors into consideration when making their recommendations to the county.
The good news is that your hard work might result in a lower tax value for your property. The dollar value of the taxes you pay may go down and having a correct value on the books for your home will be a useful starting point for future years.
Getting ready to sell? The Bandy Home Team can help you determine how much your home is worth. Check out our Denver home search website for helpful tips on pricing your Denver home for sale. You can also sign up for a monthly email update of homes sold in your neighborhood. Marianne Bandy
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