Should I Grieve My Taxes?
Posted on 12/01/2014 by Erik Wind
Congratulations to New York and New Jersey. According to DC-based independent tax policy research organization the Tax Foundation, these two states are home to 18 of the 20 most expensive counties in the country when it comes to paid property taxes. For those of us in Nassau County, you should have a certain amount of pride knowing that only Westchester County has you beat for the “most expensive” title.
If you own a home in Nassau or Suffolk County, it’s very likely that at some point in your residence you’ve received a mailer from a firm promising to lower your property taxes, often with no fee up front. If you haven’t ever grieved your taxes, I hope this article helps you understand the process of property tax grievance better so you can decide if you should do so.
How are my property taxes calculated?
Property taxes are based on the assessed value of your home, minus any exemptions you may have such as a STAR, Senior, or Veteran Exemption. Your tax share is then a percentage of the total tax levy for your various taxable jurisdictions (county, village, school district, etc.). Those taxable amounts are added up, which results in the amount you see on your property tax bill.
How do I challenge the amount of taxes I pay?
This is done by determining if your property is assessed fairly or not. One of the most common ways to do that is to use sales comparables to determine the market value of your property. If you find that your market value is less than your assessed value, you might have a case in lowering your assessment.
If these firms charge no up-front fee, how do they get paid?
Traditionally, the most common way these firms get paid is by charging you a percentage of your tax savings for the filing year they are challenging on your behalf. It’s a fair system; if they can’t lower your taxes, they don’t get paid. Likewise, it’s in their best interests to do their best to lower your taxes as much as possible in order to maximize their fees.
Do I have to use one of those firms to challenge my assessment?
No, you can file your own property tax grievance so you don’t have to pay someone, just like you can change your own oil in your car. I’m of the opinion that I would rather hire a professional to lower my taxes and maximize my savings. That way I enjoy cumulative savings year after year, but their fee is for the first year’s savings only. Many of these companies are also using GeoData and other software we’ve created, so I know they are doing their due diligence to lower my assessment and going through the correct legal channels.
At the end of the day, you’ll still be paying some of the highest taxes in the United States of America, but at least you won’t be paying anything more than your “fair share” of those high taxes.