The property tax protest often feels shrouded in mystery, and for many homeowners, it’s challenging to tie the process to divergent results. Everything from the timeline to the process can make people decide to go without. Homeowners receive their property tax bills in October, and the payment deadline is in January—but the protest period was over half a year ago, between May and August.
The process is intimidating, full of periods for gathering evidence and formal hearings before an appraisal review board. While it can seem overwhelming, the answer to ‘Is it worth protesting property taxes?’ is an emphatic yes. Texas Monthly reporter Forrest Wilder reported seeing this dramatic property protest result in 2022:
“More than any other protesters I encountered, the Viswanathans should see real savings on their tax bill. Before the protest, their estimated property tax bill was $11,506. All else being equal, in this particular year, their protest would bring their taxes down to $7,134.”
Of course, not every homeowner will see a $4,000 savings. But even a few hundred dollars, or simply the peace of mind of knowing you’re not overpaying, can make the process worth it. Keep reading to see how protesting your property taxes effectively addresses the mechanisms of calculating property tax bills and some ways to make the protest process easier. Then we’ll discuss why protesting your property taxes is worth your time.
Why Is It Worth Protesting Property Taxes?
What does protesting your property taxes do? First, it’s essential to know that this is a misnomer. You’re not protesting your property taxes themselves (which are calculated in later summer and early fall by county tax officials)—you’re protesting your property’s value for tax purposes, which is calculated in the winter and early spring. While you can’t generally oppose the tax calculation itself, you can contest the valuation of your home that will later be used in those calculations.
The Process of Calculating Property Taxes: Protest to Catch and Fix Mistakes
Local officials use two primary stages to finalize your property tax bill in October: the property valuation, and then using that valuation, any property tax exemptions you have, and the tax rate in your area to create your final amount due. Let’s zero in on the property valuation.
Your property is appraised at least once every three years by your local appraisal district to determine its value (separate from its market value). In the in-between years, your community will estimate its new value based on various market factors and comparable properties in your neighborhood.
However, these valuations may be inaccurate from one year to the next. Those comparable properties may have recently sold on the market and have many more updates and features. Your home might be right next to an easement that should affect the valuation. As a result, you may receive a Notice of Appraised Value that puts your home’s value at $20,000, $50,000, or even $100,000 more than you think it should be.
Since many parts of Texas have approximately a 2% property tax rate, that may result in you paying $400, $1,000, or even $2,000 more than you should.
Related: Why Are Property Taxes in Texas So High?
The Process of Protesting Property Taxes: While It’s Complicated on Your Own, Tax Professionals Can Help
That’s where the property protest process comes into play. Within 30 days of receiving your Notice of Appraised Value, you can file a protest notice (either on your own or through a professional tax service acting on your behalf).
On the form, you’ll be required to provide details such as your reasons why the county’s valuation was wrong, and evidence that supports your assertion. This then triggers a series of steps, culminating in a formal hearing from an appraisal review board that will hear your arguments and the county appraiser’s arguments in person before making a final decision.
Many homeowners are uncomfortable with this process or are simply unable to do it, with work, family responsibilities, and even language barriers getting in the way. But homeowners can appoint tax professionals to manage the process rather than letting the opportunity slip away. A property tax protest service can:
- Assess your property’s value to see if the county’s provided value is too high
- File the protest documents on your behalf
- Negotiate with the appraisal district
- Represent you in the hearing by presenting evidence and making arguments the board can thoroughly weigh
If you’re concerned about hiring a tax service because you’re worried about paying a high upfront cost with no results, there are many ways to protect yourself. For example, you can shop for a service with high ratings and detailed customer reviews. You can also select a service that gets paid a percentage of the savings they secure for you—that can often ensure you see the best possible results. Of course, if a service only takes a percentage of the outcome, they’re liable to only put in effort commensurate with that potential outcome.
Is It Worth Protesting Property Taxes?: 5 Ways to Answer
Knowing the initial steps of how property taxes are calculated and what precisely the protest process entails—the ‘how’ of property tax protests—may already have you thinking of how protesting your taxes can help lower your bills. The next time you’re holding your Notice of Appraised Value and wondering, ‘is it worth protesting property taxes?’ consider these six reasons:
1. You Can Lower Your Home’s Tax Appraisal Value to Pay Lower Taxes This Year
The most immediate and often most pressing reason to protest your property taxes is to lower your property tax bill for a given year. If you live in a district with a property tax rate of 2%, for every $5,000, you can reduce your property valuation by directly worth $100 in your pocket. If you’ve seen a sharp spike in your property value that you don’t think is warranted, you may save hundreds of dollars through this single motion.
2. You Can Curb Excess Property Value Increases in the Future
Protesting builds momentum. Like last year’s property values affected this year’s valuations, the recorded value from this year will be used to calculate next year’s. So the actions you take to reduce your property appraisal now will change the baseline for next year, which will snowball into the future, resulting in thousands of potential savings over your lifetime or when you own a specific property. Those savings become even more significant if you turn your protest into an annual habit instead of a one-off experiment.
3. You Set a Better Baseline for Your Homestead Cap
Protesting your property taxes isn’t the only way to lower your bill. Texas offers different exemptions to property owners, and one of the most popular is the general residence homestead exemption. This caps the amount your appraisal district can raise your property taxes at 10% and removes$40,000 from your market value.
For example, if you have a homestead exemption in place now and your home’s value is recorded at $400,000, it can only go up to $440,000 (aside from value increases from any improvements you may have made). However, if you protested your property taxes and got your value reduced to $360,000, it can only go up to $396,000 in the next year.
You don’t just have the $40,000 reduction from the direct protest. You also have the indirection reduction through your exemption. Every protest-based savings can be magnified when you’re a qualifying homeowner.
4. You Help Your Neighborhood Stay More Affordable for Neighboring Homeowners
Protesting your property taxes doesn’t just help you. It also helps your neighbors. Similarly, their property tax efforts can help you. This is because “comps”—or the detailed property value records of similar properties in your area—are evidence you and your representatives can use to protest your taxes. Professionals have access to these records and can use them to argue down property valuations if similar properties to yours are at a lower value. So if you protest your taxes to lower your property’s value, your neighbor can use your reduced value as evidence in their hearing. The county itself does not have this information, as it is not released to the general public. The following year, you can do the same.
Everyone collectively benefits when many people protest their property valuations within a neighborhood.
Related: Reasons Texans Should Protest Their Property Taxes
5. It’s Fast and Easy When You Hire Professional Tax Experts—You Don’t Have to Do It Yourself
Most people consider their own time, availability, and familiarity with the process when evaluating ‘Is it worth protesting property taxes?’ But hiring professionals can help you quickly answer the question because you’re not putting your time on the line, and your access to comps, property records, or unfamiliarity with the process doesn’t limit you. Instead, you can hand it off to experienced professionals and see what savings they can provide.
It’s Worth Protesting Your Property Taxes When You Have Home Tax Shield in Your Corner
Protesting your property taxes offers several benefits, whether you get thousands of dollars in savings, shave a few hundred dollars off your tax bill, or know you aren’t overpaying. At Home Tax Shield, we work hard to give you those results by managing the protest process on your behalf. Sign up today to see what we think your property’s value should be, and we’ll handle the steps!