Property taxes can be a significant burden for Texas homeowners. With industry data revealing that the Lone Star State has the sixth highest property taxes in the country, Texans are struggling to manage the cost of homeownership amidst tough economic times.
Fortunately, as a homeowner, you can protest your property tax appraisal for a more favorable tax bill. Protesting taxes can help keep your home’s appraisal in check, which can result in property taxes that are more stable and predictable, without sudden spikes year after year. However, protesting taxes can be quite intricate, with several detailed steps that may seem overwhelming. In this guide, we’ll explore all the relevant steps plus cover tips to help you navigate the process successfully and better manage your tax burden.
Protesting Taxes: Is It Worth It?
A property tax protest is an administrative process that allows a homeowner to challenge the market value of their property. Tax Code Section 25.18 mandates all appraisal districts to complete appraisals on each property in their district at least once every three years for tax purposes. Typically, the proposed value of your home is based on a mass appraisal technique utilized by county appraisal districts (CAD). This practice is expected, as adequate staff and resources to appraise every home individually would be an impractical undertaking.
Essentially, the CAD resorts to a mass appraisal system based on similar property values in your area to appraise the entire neighborhood. But this blanket approach can result in errors since it ignores unique features of a property that could otherwise help lower your value. This, in turn, often results in appraisals that are too high. Protesting taxes provides an opportunity for the county to review the appraised value of your home individually, potentially leading to a lower value and fairer tax bills.
5 Steps To Protesting Taxes in Texas
The process begins once you receive your property tax notice from your appraisal district. The notice details your property’s assessed value, which the CAD relies on when calculating your new property tax bill. Here are the key steps to challenge your property’s appraisal in Texas:
Step 1: Gather Evidence
First, gather enough evidence to support your argument that the market value assigned to your property is too high. The evidence you need ranges from photos of any significant damage to the property that could lower its value, to recent home sales or independent appraisals in your neighborhood.
Step 2: File Your Protest
The next step is to file a formal protest. You can submit your property value protest online, by mail, or in person. Ensure you attach all the evidence you have gathered to support your objection.
Step 3: Attend a Preliminary Meeting with the Appraiser
After filing your protest, you will receive an initial scheduling notice for a preliminary meeting with your appraiser. This meeting presents an opportunity to discuss your concerns and review records and evidence in an attempt to resolve the appraisal of your home.
In most cases, the informal hearing is all you need to work out a solution for your protest. However, if you don’t reach an agreement with the appraiser, you will receive an Appraisal Review Board (ARB) scheduling notice.
Step 4: Attend a Formal Hearing
As mentioned above, if you don’t reach an agreement on your home’s value in the informal meeting, prepare for a formal hearing with the ARB. A formal hearing can occur in person, by phone, through an authorized agent, or by affidavit.
Related: 8 Reasons To Protest Your Tax Appraisal in Texas
The hearing allows you to present your evidence and argue why you think the appraisal of your property is too high. Some of the crucial evidence to have when protesting taxes include:
- Receipts, invoices, or leases
- CPA statements
- IRS returns
- Certified balance sheets
- Records and books showing acquisition by purchase or year
- Adjusted comparable sales
- Appraisals completed by an independent third party
- Estimates for repair of structural damage
Typically, ARB formal hearings last approximately 15 minutes and begin with introductions of a three-person panel. Afterward, a county appraiser briefly describes the property, the basis of the protest, and gives a statement regarding its value.
If you disagree, you will be allowed to present evidence and argue your protest. At the tail end of the hearing, the chairperson may allow for a review of evidence from both parties and cross-examination of witnesses. You should, therefore, be prepared to answer any questions.
Step 5: Await a Decision
The ARB issues a decision on your protest soon after the hearing. If they agree with you, they will lower the market value of your property. If the ARB denies your protest, you can still appeal the decision at the district court or file for arbitration.
Crucial Deadlines to Keep in Mind
The property tax process typically starts at the beginning of each year. Between January and March, the appraisal district begins determining your home’s value. As mentioned earlier, this value is based on an estimation of a property’s market value on the first of that year, with a special focus on its condition and likely sale price. Here are some of the other crucial deadlines to remember when protesting taxes:
- March–May: In most counties, notices of a home’s taxable value are sent out in early April. However, some counties mail their notices as early as March.
- May 15th Protest Deadline: May 15th (or the 30th day after the notice of value was mailed, whichever is later) is typically the deadline to file a “Notice of Protest” to your appraisal district.
- June: The informal meeting with the appraisal staffer and ARB is typically scheduled for June.
- June–August: The formal hearing with the ARB takes place between June and August.
In recent years, the number of taxpayers protesting has increased while CAD staffing has remained relatively static. Therefore, protests are taking longer than they used to, making it even more important to meet deadlines and file paperwork as soon as possible.
Tips For A Successful Property Tax Protest
Here are some of the tips to help you protest your taxes, prepare for your ARB hearing, and win your argument:
File as Soon as You Receive the Notice
Remember that the appeal deadline in most counties is May 15th or 30 days after receiving your notice of appraisal value. Appeals that are filed after this deadline will not be accepted. Therefore, it’s advisable to file your protest as soon as you receive the notice.
Conduct Thorough Research Before the Hearing
It’s essential to do your homework before your hearing. Better preparations guarantee better results. Conduct a thorough research of property valuation in your area and gather rational evidence supporting your protest for over-valuation. This evidence may include the following:
- Photos and estimates of required home repairs
- Assessments of properties similar to your home
- Blueprints, receipts, deed records, engineering reports, or sales price documentation.
- Statements of independent appraisers to give credence to your claim
Hire an Independent Appraiser for Your Home
With mass appraisal methods, your local district doesn’t conduct detailed appraisals for each home in your area. Working with an independent, professional appraiser can be an effective way to gather evidence of the actual market value of your property.
Related: Tax Protest Strategies: How to Lower Your Property Taxes
Having an independent appraiser’s report strengthens your case when disputing the property tax valuation. Their documented assessment, backed by data and industry standards, serves as valuable evidence during the protest hearing.
Identify Errors in Property Records
The CAD uses algorithms based on public records to estimate your home’s market value. Therefore, it’s crucial to cross-check the public records and ensure they are factual. These records contain important details about the property, including the lot size, square footage, number of beds and baths, and the age of the home. If the appraisal district is erroneously basing its appraisal on an extra 1,000 square feet, you have compelling evidence that could lower the market value.
Find Tax Solution Services to Protest on Your Behalf
While protesting taxes may be a daunting task full of legal requirements, you don’t have to travel this route alone. Look for a reputable service provider to help you along every step of the process. Quality tax experts will ensure that you’re filling out all the right paperwork and meeting any deadlines. They fully understand the ins and outs of tax laws and can help you make the most out of all resources that are available to you.
Leverage Property Tax Experts to Manage Your Tax Bill
Property taxes can dampen the excitement of your homeownership journey. As property tax bills continue to soar, homeowners can lower the market value of their property by protesting taxes. However, the entire process can be time-consuming and daunting regardless of your real estate experience. However, with the guidance of residential property tax experts who know their way around tax protests, you’ll be better equipped to handle the process.
If you’re looking to save some of your hard-earned money, the tax professionals at Home Tax Shield are excited to help. We provide the help you need to protest your taxes effectively, incorporating modern technology and vast experience into the valuation and protest process. We strive to ensure you don’t pay a dollar more than you should on your property taxes each year. Sign up today to start the process of protesting your property taxes and keeping money in your pocket.