You HAVE 1 Day to Start a Tax Appeal- 2-20-19

The valuation of your properties is an essential component of knowing the overall worth of your investment portfolio. Every year before February 21st -like tomorrow the 20th! in every community in Connecticut a property owner should consider deciding whether or not their property- be it a personal residence, multi-family or other investment properties might be over assessed and, thus the tax bill is too high. It only takes 15-25 minutes to file online with the assessor in each and every town!

Each year the Assessor in each community is required to accept a tax assessment appeal to have a complaint filed with their office. Once properly filed the paperwork is turned over to the town or city’s Board of Tax Assessment Review. That Board usually consists of two or three individuals appointed by the Mayor or City Council on an annual or semi-annual basis to hear the tax payer’s complaints. Usually the Board schedules hearings to discuss the complaints or the mistakes that may have been made by the Assessor’s Office; by the private Assessing Company that may have not properly examined the Subject property; or may have made a clerical error; the tax payer may have found or discovered an obvious or hidden error; or just a plain dumb error; or perhaps the taxpayer may have the facts wrong.

Every 5 years each of the 169 communities /cities/towns in CT is required by the State Legislation to require a complete revaluation of each and every property be it a small parcel of vacant land or a hotel, apartment building or major skyscraper, etc. depending upon the financials of the community and the Assessors Office their own department may do the assessment work or they may hire out of state companies who supplement their staff with area people who might already be familiar with the area. The Assessor and staff are supposed to be there to guide the Revaluation company in the processing of the Assessments, in pointing out specific facts, locations, amenity adjustments, and particulars that are relevant to the community. Monitoring the figures and valuations are to be objective findings completing the Revaluation Process. The valuations are based on the assessment figures which are 70% of the value. Therefore if they figure the value is $100,000 as an example, then the assessment is 70% or designated as $70,000.

The Assessment figures are computed from the Assessors standards which are different from appraiser valuation methods which are based on the Uniform Standards of Professional Appraisal Practice-known as USPAP. Appraisers use three methods: the comparable sales approach, the income approach, and the Cost or replacement method. Depending upon the reliability of the Assessment Office or its Revaluation team one method may be stressed over another. Over the years one has found that different Assessor Offices like to weigh one method over another which may be challenged. In any event the Assessors methods can be different than the Appraiser’s methods in reaching a valuation or fair market value. In cases of an income property the taxes are typically removed from the calculations and later factored in at a 2% figure before a valuation number, and added in as a capitalization rate figure.

So do you think your taxes are too high? Then you get an appointment to go to the March or April hearing-usually pretty informal- and say your peace to the Board Members (there may be someone from the Assessors nearby to correct an error or review) but unless there is a true error –square footage/condition/wrong use/ or an obvious mistake then the Board will probably pass and not change any figure. Then you have to decide is it worth the fight?

The mill rate set annually by each community has no bearing except that its rate times the Assessment are the taxes. For instance, If there are several similar residential properties assessed much lower than your residential it may be worth challenging. If your commercial property assessment seems too high or appears to be excessive than you have to decide whether or not to challenge. The best time is at the beginning of the 5 year revaluation period since the assessment unless there are changes to the property stays the same and all the valuation computing is based on that October date

Now after the Board returns their paperwork with no change you will have another 60 days to file a suit to challenge the findings and start a suit which can get costly. The only way left is for the tax payer to file a suit. And with are filing fees, legal and court time to get it to a pretrial, and at the pretrial there should be an appraiser there who has pretty much completed a summary appraisal report based on the date in question going back to the October date of revaluation. Typically the referee or first judge in the state taxation court in New Britain where these cases are heard will try to work out a compromise between the parties. Most likely the town or city Assessor will appear with their corporation counsel and perhaps a member of staff or revaluation company. Going to the pretrial without an appraisal known as an ad valorem report will make it much harder to equitably resolve the case. A trial of course will cost many thousands with testimony and at that point may not be worth the money and efforts. Resolving the case in pre-trial in this appraiser’s opinion might lead to a more satisfactory solution and compromise of efforts, time and money.

So think 2-20 NOW and make your decision ASAP.

February www.marcgottesdiener.com
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You HAVE  1 Day to Start a Tax Appeal- 2-20-19

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