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"Ask the Attorney:" Can I get My Property Taxes Lowered?

Guest blogger Jason R, Rittie, Esq. of Einhorn Harris answers the question can home owners' property taxes be lowered.

Dear “Ask the Attorney”:

I own a house in Morris County.  Recently, I received my 2012 Notice of Tax Assessment from the tax assessor and I believe my taxes are too high based on the value of my house.  Can I request a reduction in my property taxes?

K.B.

Our next guest blogger is Jason R. Rittie, Esq.  Jason is Counsel to Einhorn Harris and a member of the Real Estate and Land Use & Zoning Department as well as the Closely Held Business Group.  He works with property owners and developers in complex real estate transactions, particularly in acquisitions, leasing and sale of commercial and residential properties, and tax appeals. He also represents borrowers, private lenders and banks in commercial and residential finance and mortgage transactions.   

Dear K.B.:

First, let me clear up one misconception that many property owners have, you cannot appeal (“request a reduction” in) the amount of your real estate taxes.  This is based on the municipal tax rate. What you can appeal is the tax assessor’s determination of the tax assessment value of your property. By the filing of a tax appeal, you are challenging the tax assessment as not being an accurate determination of the value of the property. All property in the State of New Jersey is assessed at fair market value (FMV) as of October 1st of the pre-tax year. The State also uses what is commonly known as the Chapter 123 formula to test the fairness of an assessment. 

In order to be successful with a tax appeal, you must be able to prove that the ratio of assessed value to true value exceeds the Chapter 123 average ratio by 15%.  New Jersey assumes that the current assessment made by the municipal tax assessor to be correct, and the property owner must overcome this presumption by showing that the assessment is unreasonable compared to fair market value. A property owner must present evidence by submitting a professional appraisal, or by independently gathering information about comparable properties within similar neighborhoods in the municipality that have recently sold for less than the value of your property. The comparable properties must be of a similar size, style and characteristic, and the sales should have been bona fide, arm’s length transactions. There are strictly enforced filing deadlines, and if you miss the deadline, your appeal cannot proceed. Also, you must continue to pay and be current with the taxes pending resolution of the appeal. Tax Appeals must be filed on or before April 1, or May 1 where a municipal-wide revaluation or reassessment has been implemented.

For additional helpful information, you can obtain a copy of the State of New Jersey Treasury Department’s publication A Guide to Tax Appeal Hearings or contact a qualified Real Estate Appraiser or Real Estate Attorney.

“Ask the Attorney” is a new blog in which answers to your legal questions submitted to asktheattorney@einhornharris.com may be answered.  The answers to the questions are for informational purposes only and are not to be construed as legal advice or the creation of an attorney-client relationship.  The facts of each case is different, therefore you should seek competent legal representation. 

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esquire908 February 22, 2012 at 04:16 PM
This process should include an attorney, and, unfortunately, precedent will show that the savings is rarely worth that bill.
Randy Grauerholz February 23, 2012 at 10:46 AM
I was successful in securing a $55,000 reduction in my taxes on a patio home in Hastings Square. After checking my tax bill, carefully, I saw my home assessed at over $300,000! I filed all paperwork, via certified mail, and achieved savings of over $1000 per year on my tax bill. I secured comps through a local real estate agent, and found the process not to be that difficult. Good luck to others...it is well worth your time/effort!
Thomas Lotito February 23, 2012 at 01:42 PM
Hats off to you Randy. A $1000 a year is a tremendous savings. I agree it was well worth the time and effort.
Beach Mover February 23, 2012 at 02:41 PM
Randy did you have to go to hearing to present your case or just by certified mail? Thanks Jeff
Randy Grauerholz February 23, 2012 at 02:49 PM
Jeff....I obtained all the necessary paperwork, completed it and attached the necessary comps to prove my patio home was over assessed, and mailed copies to Morris County and Washington Twp. I was advised, weeks later of a settlement that I agreed to. I submitted a signed copy of my agreement with Washington Twp. and all was done. It does take months before the new tax assessment kicks in, but well worth the time and effort!
Adit Khatkhate July 26, 2012 at 11:43 PM
What if i purchase a home, can i have the assessed value reduced based on the purchase price?
Al Baron July 27, 2012 at 12:28 AM
Yes, you can appeal your assesment. Your best bet is to work with an atttorney who only deals in Real Estate. A general practitioner usually has a learning curve which they will charge you for. I recommend Richard Wade, Esq. 18 Bank St. Morristown, NJ 07960. Wade-law.com. He has been working exclusivly in Real Estate for almost 30 Years.

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