Taxes and Assessments Are Out of Control But You Can Change That!

People do not believe they can have any say when it comes to their taxes and assessments, but they are wrong. The economy is in an uproar right now and cost are rising all around us. We as consumers have the opportunity to take measures in many ways to help ease the financial burdens. Get yourself in the habit of questioning everything you spend money on by asking yourself if there is a way that you can somehow reduce this cost. I am going to discuss one particular bill that you have probably never even thought to question in the past. Your property taxes,based on your assessment, this is a major bill that you are faced with every year. I want you to read this article and relate it to your situation. Take this seriously because the chances are you will be able to save a substantial amount of money on your taxes.

The crash in the housing market has drastically reduced the cost of homes on the market. There are very few areas in the country where housing prices have not decreased exponentially. Entire neighborhoods have lost value in their housing. If your house has lost value, challenge the assessment. If you anticipate a silver lining in the black cloud of declining home prices in the form of lower property taxes you may be disappointed. The National Taxpayers Union figures that as much as 60% of taxable property in the U.S. is over assessed, largely because assessment cycles have not caught up with the decline in home values.

In California, for example, a home's assessed value is based on its purchase price, plus increases of up to 2% annually. The house is not revalued until it is sold again. This means that the home owners are paying taxes on the value of the house when they purchased it plus any yearly average increases. The fact is the real value of the home has without a doubt decreased in the face of our recent economy but the chances are your assessment has not. To capture the price plunge of the past few years, homeowners must file an appeal and prove that their home's assessed value exceeds its market value. In San Diego County, the assessor's office processed 80,000 appeals in 2008; the average reduction in assessed value so far is $110,000, equivalent to a tax cut of $1,200.

Many jurisdictions calculate a home's assessment as a fraction of its market value, so do the math to make sure your home is priced fairly unless you enjoy paying taxes. Also verify that you have received any breaks you are entitled to, such as a homestead exemption or a reduction for seniors or veterans.

If you believe your home property assessment is to high you have the right to appeal. Go to the assessor's Web site or office to double-check the "property card" and any working papers for your home. Are the figures for square footage and number of bedrooms and bathrooms correct? Has the assessor accounted for any features that could detract from your home's value, such as an irregularly sized lot or a carport instead of a garage? Pull the property cards for five or ten neighboring homes that are similar in terms of age, style and features. If the assessments on similar properties are a lot lower-1O% or more you have a good case based on uniformity which means you could be paying less taxes. Everything you need is public record, meaning you have every right to request and receive the information.

If you believe your home's assessment exceeds its market value, you will have to provide sales-price data for several comparable homes. You can get that information from a real estate agent, or check the local public library or your clerk's office. Ask the assessor whether a recent appraisal for, say, a refinancing is acceptable proof of .your home's market value.

Read your assessment letter for details on how to appeal. You will probably have two windows of opportunity. During the first, you may request a reduction in the assessment of your home for the forthcoming tax bill. During the second, you may appeal for a retroactive reduction and refund of taxes paid.

Until your appeal is resolved, pay your taxes in full to avoid incurring penalties and a lien against your home. As a last resort, you could go to court, but that is an expensive process usually best suited for commercial property owners with more at stake. You may see advertisements for companies that will help you appeal your assessment, often in exchange for about half of any savings on your taxes. But with the right preparation, you can do just as well yourself using a guide such as How to Fight Property Taxes ($6.95), from the National Taxpayers Union (www.ntu.org). The NTU's Web site also has links to state and local taxpayer associations that may offer further insight into the appeals process.

In today's economy you have to be proactive, every area of your life that you can save money you must take advantage of. As a home owner you have rights and just because the tax bill comes from a government agency does not mean that they are always correct. Exercise your rights and challenge your tax bill if you believe your home assessment is to high.