CNN/Money One for credit card only hard offer form at $9.95 One for risk-free form at $14.95 w/ $9.95 upsell  
Personal Finance > Five Tips
Keep your property taxes down
5 Tips: Reducing your property taxes
July 16, 2004: 2:36 PM EDT
By Gerri Willis, CNN/Money contributing columnist

NEW YORK (CNN/Money) - Local governments are strapped for cash and they've decided home owners should pick up the slack. Collections from property taxes are up 20 percent in the past three years ended in 2003.

But you can fight town hall. Here are today's five tips.

1. Knowledge is power.

There are two ways town hall can make you pay more. Your local government can raise the "millage" rate, the number that represents how much you'll owe per thousand dollars of property value. Or they can reassess your property. An assessment is simply the act of placing a value on your home.

There's not much you can do to change the millage rate (short of starting a political movement), but you can fight city hall over an assessment.

"What homeowners often don't know or realize is that this process is a subjective one." says Pete Sepp, spokesman for the National Taxpayers Union. "Essentially, your assessment is one person's opinion about the value of your house."

There may be mistakes, miscalculations or assumptions made by an assessor that cost you money in taxes. Given the fact that assessments can be done from the public right of way, it's no surprise there can be errors. Imagine trying to figure out the value of a home from the street corner.

Sepp says according to figures he's seen, 30 to 60 percent of properties in the U.S. may be over-assessed. If you're like many people with mortgages, you may have your property taxes automatically escrowed, so you're less likely to notice or question changes.

Most homeowners don't even realize they have the right to see their assessment reports -- much less appeal them. If you decide to appeal, chances are pretty good you'll win. Roughly half of the people who take their complaint all the way to an appeals court win some sort of relief.

2. Hunt & gather.

Is your assessment accurate? Is it fair? Is it on par with similar properties in your neighborhood? It's up to you to find out.

Sepp says there are a number of ways get the information you need. You can always talk to your neighbors. If homes in your neighborhood are similar to yours in age, size and condition, it can't hurt to find out what their homes have been assessed at.

The most practical approach is to visit your town or city's assessment office. There, you'll be able to compare notes. Ask to see information cards for similar homes in your neighborhood. This information is supposed to be available to the public, but there may be some procedures you need to follow. For instance, you may only be allowed to view photocopies and you be need to pay a fee per page. Or you may be required to make an appointment.

If you work full time, or are too busy to do the legwork, you can hire a property tax consultant to do it for you. Some services may charge a percentage of the savings you win, much like a law firm. Others may charge a flat fee.

Mortgage Rates
30 yr fixed 4.48%
15 yr fixed 3.92%
5/1 ARM 4.34%
30 yr refi 4.49%
15 yr refi 3.90%

Find personalized rates:

Rates provided by

You should also ask your local assessment office about the methods they use to assess property. Some use a replacement cost method, which means estimating the amount of money it would take to rebuild your home.

If you purchased your home recently, your local assessor may base your home's value on the sale price (or a percentage sale price). Because home prices have risen sharply in recent years, you could be paying much more than the previous owners did just last year.

For more information on how to fight an assessment go to the National Taxpayers Union Web site at

3. Timing is everything.

Normally, jurisdictions follow an assessment schedule. But it can happen any time, for any reason and you can easily be caught off guard.

Due to state and local budget shortfalls, some schedules have been amended. So be alert. If you don't move fast, you could get stuck.

Sepp says it's very important to act as soon as you're notified of an assessment. Find out how much time you have to file an appeal, as there is almost always a limited window. Some jurisdictions set aside a particular time every year to hear them. Others give you a grace period after your reassessment, which could be anything from two weeks or 30 to 60 days.

Building your case could take time, so don't delay. If you don't move quickly, you may have to wait a year or longer. And in the meantime, you'll be paying more.

4. Look before you leap.

If there is a glaring error in your property report, the assessment office will generally correct it quickly. If there are no problems with the accuracy of the property card, but you find that you've been over assessed, you may need to file for an appeal.

If this is the case, check with your assessor's office about what documents are admissible for an appeal. It may seem like a no-brainer to run out and get an appraisal to dispute an assessment. But before you spring for your one, check to make sure you'll be able to submit it.

Some localities may not accept appraisals for various reasons including possible conflict of interests. Property cards for similar homes in your area and few forms may be all you need. In any case, understanding the proper procedures can help make the process less stressful.

5. There's strength in numbers.

According to Sepp, from the end of 2000 to the end of 2003, state & local property tax collections have risen 20 percent. But more and more, taxpayers are banding together to fight rising property taxes.

These new activists are part of a movement that really began in 1978 with the passage of California's Proposition 13. (Prop. 13 rolled back property taxes and gave taxpayers the right to vote on increases.)

Personal finance
Gerri Willis

The Howard Jarvis Taxpayers Association is largest taxpayer rights group in California with 200,000 members. It was founded by the principal author of Proposition 13. Its current executive director, Kris Vosburgh, says he's recently gotten calls from activists in Texas, Maine and even Canada who want to enact similar legislation.

He says one of the most important things you can do is join a taxpayers rights group to make your voice heard.

"Don't be isolated and don't just roll over. You're not alone. Instead of being a solo voice, it's far better to be part of a chorus."

For more information on taxpayers' rights groups in your area, go the National Taxpayers Union Web site

Gerri Willis is a personal finance editor for CNN Business News. Willis also is co-host of CNNfn's The FlipSide, weekdays from 11 a.m. to 12:30 p.m. (ET). E-mail comments to  Top of page

IRS may have just poured cold water on state efforts to skirt SALT deduction cap
New to the job market? 5 pitfalls to avoid
How should I invest my nest egg for maximum retirement Income?
The Fed isn't sweating inflation ... yet
The three biggest risks to global investors
IRS may have just poured cold water on state efforts to skirt SALT deduction cap

graphic graphic