Property taxes are a main source of income for local and county governments. They are also a huge expense for a lot of homeowners, and they come up every single year. Even if you’ve paid your mortgage in full, you still have to pay property taxes. Most property owners simply pay them and don’t think twice about it, but there are a number of people who may be overpaying without even realizing it.
Do you know what your property tax assessment really means? Are you aware of how taxes are calculated, and whether yours are accurate? You might be surprised at just how often your DeKalb County tax assessor might get things wrong.
The Method, Not the Ma
In defense of tax assessors everywhere, most of them are simply doing their job. They are tasked with using the available information on real property to determine values for literally thousands or even millions of properties in a county or state. The assessment process is what causes most errors, not the assessors themselves.
How Assessments Happen: A Step-by-Step Guide
Real property assessments are a numbers game. Because of the volume of properties to assess, county tax assessors just don’t have time to go to each property and provide an individual, exact appraisal and tax estimate. Instead, they use historical data, market trends, and sales information to come up with an accurate valuation and tax rate for each property. Here’s a breakdown of how they work:
1. The assessed value of a property will be determined on an annual or bi-annual basis. In some jurisdictions, properties may only be assessed when there is a transfer of ownership. There may also be other guidelines for assessment schedules. In DeKalb County, assessments are conducted annually and notices are sent to property owners in May.
2. To determine the assessed value of real property, an assessor will combine a variety of statistics and data on the property, including the Property Appraisal Department’s appraisal values and assessed values for a property. In DeKalb County, the computer-assisted mass appraisal system looks at:
a. Zoning information
b. Existing use or limits of use
c. Building permit data
d. Mapping data
e. Sales data
f. Building characteristics
g. Other factors deemed relevant in determining a fair market value.
3. A Dekalb County tax assessor will use the market value approach and cost value approach, and then combine their results, to determine an appropriate value for the property.
a. Market (Sales Comparison) Approach: Value determined by comparing a property with similar properties that have recently been sold, with adjustments made for differences between comparable homes and the property in question. This is the primary method used in Dekalb County.
b. Cost Value Approach: The tax assessor will compile all of the data collected on a property and use the mass appraisal system to calculate replacement costs for the entire structure, minus depreciation and plus improvement values, to determine neighborhood values.
c. Income Approach: This option is used in select cases or by certain assessors when working with commercial property. Value is estimated entirely based on the income and expenses of an income-earning property, which results in a net income that is then used to assess the value and relative tax rate.
4. A letter, known as your tax assessment, will arrive in your mailbox sometime during the month of May. Get to know your assessment and make sure that you review it for accuracy before you send in any kind of payment.
5. Those who feel that their taxes are inaccurate for any reason can file an appeal with the Dekalb County tax assessor to have their taxes reevaluated or determine whether the property tax is really accurate.
Tips for Reducing Your Property Tax Obligation
Every property owner has a right to file an appeal when they feel that their property tax valuation is incorrect or that something is missing that affects what they are supposed to pay. Through the appeals process, with the assistance of a professional appeals team, you can learn about a lot of ways to reduce your taxes and avoid huge increases from one year to the next. Since most people have never been through the appeals process, here are some tips to keep in mind.
Research before you renovate: Building additional structures or adding on to your property is going to increase the property value, presumably. If you’re considering investing in a deck, new outbuilding, or a pool, check with your local building and tax departments to get an estimate of how much the renovation will increase your taxes. That way, you’re not surprised with a huge tax bill.
Ask for your property card: You are entitled to a copy of your property card, which will list various information about your property, including the lot size, structural dimensions, the number of rooms, and the number and types of fixtures in the building. There also may be a section for improvements or special considerations. Review all of this information carefully for accuracy and check your online property record for further details and property information.
Don’t get too fancy: Tax assessors have to follow a strict set of rules for evaluating homes for tax determination. However, their assessments are still subjective in some places, and that includes physical appearance. More attractive homes or those with better curb appeal tend to be assessed at higher values. This isn’t to say your home should be ugly but be mindful of how it fits into your neighborhood. If it looks like the most expensive house on the block, it’s probably going to be valued as if it is.
Know your neighborhood: Look at the comps for yourself. You probably know your neighborhood better than the assessor. Figure out what other homes are valued at and how they stack up against yours. If your home is valued higher than another home that seems like it has more resale potential or better features, ask questions. Sometimes, assessors and appraisers don’t have all the information, so they get it wrong.