Published by Mr. Landlord.
APPEALING PROPERTY TAXES AND WINNING!
The following is an example of one landlord appealing his property taxes. This brief illustration is shared as encouragement to other landlords who may think it is not possible to successfully appeal your property taxes. The landlord, Jason(PA), and a regular contributor to the MrLandlord.com Q&A forum, shares his story below:
How I appealed my property taxes and won!
First I must say that many states may assess property assessed values totally different than they do in my state (Pennsylvania), I know that for a fact.
However, since some landlords have questions about whether it is even probable for individuals to successfully challenge tax assessments, I figured I would share what I did to get three nice sized reductions.
In my local county, the last assessment was done around 1999, so everyone's assessed value is lower than their current value. Think about it, it is a BRILLIANT strategy for the Government. You could be assessed 30% higher than you should be, but your assessed value is still LESS than market value, fooling most people.
Here we have a state tax equalization board that sets every year a CLRM - common level ration multiplier, this year for my county the CLRM is 1.42. To find out the value that the county says your property is worth, you take the assessed value times 1.42 . Here is an example of one property that I just did a successful appeal on.
Property A in Harrisburg old assessed value = $63,800
My claim is property value is worth $71,000. Right here is where people get fooled, so why would I appeal this assessment?
After multiplying $63,800 x CLRM of 1.42, the county is considering my ACTUAL value to be 90,600.
My claim was that my property should be assessed at $50,000, so that 50,000 x 1.42 = true value of 71,000
They agreed, lowering my property taxes from $2020 to $1575, increasing cashflow by $445 a year which is about $38 a month, year after year until that property gets reassessed some year in the future.
I did 6 properties and had significant reductions in three. After sitting in front of the appeal board they saw I was a landlord trying to save a few dollars and they didn't like it so much.
The greatest force on Earth, compounding interest. - Albert Einstein