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MSNBC and the National Taxpayers Union have discovered just one small aspect of how corrupt and inaccurate the property tax on residences is. It's great that more people are demanding the values of their homes be reduced because of the current economic problems in our country.
In Pennsylvania you have the right to file an appeal every year. You need not wait for a reassessment. Problem is they county may increase instead of decrease your property assessment.
In reading this story you will note there is now an industry forming of lawyers filing property tax appeals for 50% of the savings for the first year.
Lastly, note the wealthy home owner and how much he got his taxes reduced. He could afford to hire an attorney and an appraiser...but unless one can find an attorney willing to take the 50% deal mentioned above, the cost for most attorneys is around $350. Appraiser perhaps $500. Most lower and fixed income citizens can't take the risk of spending that kind of money and perhaps not getting a tax reduction at all. An appeal of an unfavorable decision at the county level can be filed in common pleas court. Filing fee $63. Attorney representation at the court hearing, maybe $500. Appraiser testifying...who knows...let's say $300. It's worth the crap shoot for wealthy homeowners...but the lower income folks can't afford all of that.
NOTE: We have sent a wealth of information to the National Taxpayers Union and they did not appear interested in the corrupt property tax issue. So, it is encouraging to see them starting to show interest. Bob Logue, STOP Primary Residence Protection Plan. Learn more at
Now that the housing bubble has burst, up to 60 percent of the nation's taxable property may be overassessed, meaning owners are paying thousands of dollars more in taxes than they need to, experts say.
That is leading to a flood of appeals in many markets from homeowners eager to cut their taxes and speed the process of aligning tax valuations with reality.
While home prices have fallen by 30 percent on average since their 2007 peak, according to the Case-Shiller Home Price Index, many counties only reassess every three to five years and have little incentive to move faster considering how important property taxes are to funding local government operations.
"People forget they need to appeal," said Barbara Payne, executive director of the Fulton County Taxpayers Foundation in Georgia. "Everyone should have appealed more than once in the last five years or you're paying too much."
Those who appeal are getting mixed results. Only 20 to 40 percent of those who challenge their assessment walk away with a victory, the NTU said.
"Appeals have become more difficult in the last two years now that municipalities are fighting tooth and nail for everything," said Anthony Sarro, president of eTaxReductions.com, a company that represents people on property tax appeals.
A success story
Stuart Sendell, a retired mortgage banker living in Morristown, N.J., was ultimately successful but said the process took 14 months to complete.
After reading a report that found the average assessed value of real estate in his town had increased by 5 percent, Sendell paid a visit to his local assessor's office to examine the calculations.
"Everyone knew housing values were dropping like a brick," he said, remembering that he thought the report "couldn't be right."
| Stuart Sendell's home was estimated by the township to be worth $1.6 million, but his appraiser concluded his home was worth only $970,000. After appealing his property assessment, he accepted a 25 percent reduction after a lawyer for the township asked to strike a deal. |
Two months before his court date the lawyer for the township asked to strike a deal. Since New Jersey law gives assessors a 15 percent margin of error for assessments, Sendell accepted a 25 percent reduction, which showed up in his taxes. He was awarded a $5,400 tax refund — a savings he now banks each year.
Sendell's experience isn't unique. "There has been a ramp-up in requests that began well over a year ago," said Peter Sepp, vice president for policy and communications at the NTU. "People are getting sticker shock over assessments that have yet to be adjusted to the realities of the depressed real estate market."
Filing an appeal
Attorney Arthur Semetis, a resident of Westchester County, N.Y., used a law firm to file his tax grievance two years ago. "They know what the courts are looking for," he said, referring to the law firm, "and work with the judges all the time."
His lawyer was initially unsuccessful in negotiating with the tax authority but knew to stick with the process. The firm ended up winning him a tax reduction of 12 percent on the second go around in the judicial hearing.
An industry has cropped up around the process, with companies filing appeals on behalf of residents in exchange for a cut of the winnings. Most firms work on a contingency basis, taking about 50 percent of the savings for the first year.
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