This year, the April 30 deadline for filing property tax appeals falls on a Saturday. To ensure timely service and filing of tax petitions for our clients, we will be unable to accept property tax appeal cases for review, service and filing any later than Friday, April 22, 2011. Useful pointers concerning your property taxes:
- The property taxes that you pay in 2011 are based on an assessed value established by the tax assessor as of January 2, 2010.
- Sometime in March, property owners will receive notices from the tax assessor’s office of the assessor’s estimated market value for their properties as of January 2, 2011. This notice of estimated market value is part of the value-setting process for next year’s—that is pay 2012—property taxes. Under Minnesota law (Minn. Stat. § 273.01), assessors are allowed to make adjustments to assessments until approximately mid-June of the year of assessment.
- If you have questions or dispute the estimated market value, consider taking advantage of this administrative adjustment window between the time you receive your notice of estimated market value in March and the assessor’s deadline for making administrative adjustments in June. Call the assessor’s office and raise your questions. You might succeed in convincing the assessor of changing the estimated valuation if you have made a good case for the adjustment.
- Remember: you cannot expect the assessor to lower your property taxes; your assessor’s authority is to set your property value, so you can only lower your property taxes through the assessor by seeking and obtaining relief in the form of a lower assessed value for your property.
- Aside from informal communication with the assessor’s office, a more formal administrative process that is available is the Board of Equalization. Your notice of estimated market value should inform you when the Board of Equalization will meet for your taxing jurisdiction. Beware of going blindly to a Board of Equalization hearing without having discussed your concerns with the assessor in advance. If the assessor is not receptive to a reduction when you discuss your property in advance of the hearing, our advice is: don’t go. Be aware that this Board has the power to raise, as well as lower your assessed value. An attorney tells the story of advising his client not to go to the Board to seek a reduction; the client went anyway and found his property’s assessed value of $13 million increased by the Board to $15 million.
- Does it pay to file a property tax appeal? In most cases, it does not pay to judicially challenge the assessed value to residential property. Consider this, at a tax rate of between 1 to 2 percent, the tax savings achieved from reducing your home value by $50,000 will amount to a $500 to $1,000 annual tax savings. Given that the filing fee for tax court in Hennepin County is $325 and service of process fees run about $40, the costs alone will eat up quite a bit of that tax savings. On the other hand, commercial/industrial properties are taxed at a tax rate of between 3 and 4 percent. Given the higher-valued properties and the higher tax rates, it is generally these types of properties that stand to gain the most from challenging their assessed values.