Property taxes too high? Here's how to appeal them and lower your tax bill

Some homeowners are getting an unwelcome surprise in their mailboxes: New property assessments from their local tax offices that put a far higher value on their homes than prior to the pandemic. In some cases, that means an increase in their property taxes at a time when other costs, like food and fuel, are also surging.

There is some good news for homeowners, however. You can appeal your property assessment, and success means your tax bill could be lowered by hundreds to thousands of dollars. 

The U.S. housing market surged during the pandemic, boosting the value of the average home to $344,000 — 37% higher than in February 2020. Counties and cities typically reassess properties every year or two, although sometimes there's a gap of several years — that means homeowners are now seeing the impact of the property boom in their tax bills. 

"It's no secret that the market has been crazy the last two years," said John Whitehead, the property assessor of Knox County in Tennessee, which recently sent out new property assessments, with home values rising 40% on average. 

Some property owners have been shocked by the increase and have sought to lower their valuations, he added. Knox County, home of Knoxville, received 10,000 appeals, he said, and about one-third were successful in getting assessments lowered. "If they can show the value is wrong, we will change it," Whitehead said.

Although appealing your assessment can pay off, only about 5% of people do so, according to the National Taxpayers Union Foundation. During the past five years, the average property tax increased 18% across the nation, an analysis by home-services company House Method found.

Here's what experts advise for people considering challenging their tax bill.  

Understand your town's assessment

First, it's important to note that a higher property assessment doesn't necessarily mean a higher tax bill, experts say. That's because new assessments are typically designed to be revenue-neutral, which means a municipality can't gain more tax revenue through the new assessments. 

Instead, what's important is whether your assessment has increased more on a percentage basis than the overall average increase of your town or county. For instance, Knox County increased its assessments by 40%, but people whose properties increased below that rate enjoyed a tax decrease, while those whose properties appreciated above 40% got a tax hike. 

What can you sell your home for? 

Some homeowners are shocked when they see their new assessment, but tax experts say some of those values could use a reality check — the assessment should reflect what your home could actually fetch on the real estate market. 

Before making an appeal, look at local real estate sales for comparable homes to get a sense of whether your assessment is in line with market conditions. If the new assessment values your home higher than what comparable properties have sold for, then you may want to move forward with an appeal. 

Find your city or county's deadline for making an appeal

Your new assessment should include information about how to make an appeal. Typically, there's a window of time for submitting an appeal, sometimes as short as a few weeks. 

For instance, Cook County, Illinois, gives property owners only 30 days to appeal after receiving their new property assessment, while homeowners in Fulton County, Georgia — where Atlanta is located — have 45 days. The window for appeals can be very small, which is why you may need to act quickly. 

Get a third-party assessment

It can pay to get a third-party assessment of your home's value, experts say. A local real estate agent who knows your market will typically provide a comparable market analysis at no cost, said Richard O'Donnell, a former tax assessor who now helps property owners appeal their assessments through O'Donnell & Cullen Property Tax Consultants.

"That will help you determine if it's in line with fair market value," O'Donnell said. "Many realtors will do this at no cost — it's a way to promote their business."

O'Donnell said he prefers hiring third-party professional appraisers because that can help bolster your case when you go before the appeals board. 

Stick to the facts

When it's time to make your appeal, stick to the basics and remember that you don't have a lot of time to make your case —sometimes you'll have just 15 minutes, the experts say. 

"A lot of them will come in, and they'll talk about the assessors office not doing what it's supposed to do, and that's not helpful," Whitehead of Knox County said.

Keep it professional, talk about the facts — and don't get angry, he emphasized.

Beware: Your assessment could also go up

Whitehead noted that property owners should also realize there's a chance their assessments could rise due to an appeal. 

"There is the potential for it to go either way, although 95% of the time they aren't going to go up," he said. "But there are cases where we find out that they have a pool and we didn't have a pool [on the assessment], or they have a basement and it's finished," which might not have been known to the assessors. 

He added, "They need to make sure they have an appeal before they start giving information away."