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If the value of your home surged in recent years, there's a chance your property tax bill followed suit. The average property tax on single-family homes in the U.S. increased by 3% in 2022, after increasing by 1.8% in the previous year. You may see an uptick on your tax bill if your local government laws changed, home values in your area increased or your county reassessed the value of land in your area.
Fortunately, there are ways to lower your bill or file an appeal if you find yourself in this situation.
1. Act Right Away
Property taxes are calculated by multiplying your home's assessed value by the local tax rate. While you can't dispute the tax rate, you can file an abatement request if you feel the property assessment is too high or if there's been a mistake on the property record that inflates its value. If successful, the abatement lowers your tax bill based on a reduction in the assessed value of your property.
The tax collector's office typically sends notices to homeowners at set intervals throughout the year. Once you receive the notice, check the deadline for submitting the abatement request. You may have a short window of time, such as 30 days, to file the paperwork—so it's important to act right away.
Head to the local tax office in your area and ask about the process for requesting an abatement. Also ask for a copy of your property tax card, which reflects the information used to determine your property's assessed value.
2. Check Your Home's Assessment
Tax assessors may rely on historical data to estimate your property value, so it's a good idea to read through the tax card and look for any obvious errors. Check the address and age of your property, total square footage, lot size, building features and the number and types of rooms. Any mistakes in these basic characteristics may inflate the property's value and qualify you for a reassessment.
3. Find Comparable Homes in Your Area
To put some rationale behind your appeal, you'll need to research other homes in your neighborhood that are comparable to yours. The homes should be the same property type as yours (such as a single-family), located within about a mile of you and sold within the last 90 days or so. Check for a similar layout of bedrooms, bathrooms and square footage. Pull tax cards on four or five similar properties that fit the bill. (Or, you may be able to ask a local real estate agent to pull this information for you.)
If any of those home values are lower than yours, the information will support your appeal.
4. Consider Hiring an Expert
You have several options for getting a second opinion on your home's value.
A property tax consultant or an online service can handle the details of researching your home's market value, comparing it to others in your area and filing the abatement request. A home appraisal is another option for determining your home's value, but you typically won't get help with the rest of the process from an appraiser.
Depending on what your expert says about the value of your home, you may be able to use their findings to appeal the assessed value of your property.
5. File Your Abatement Request
Gather your findings and get ready to file your abatement request, which usually involves filing a form and including supporting information. For instance, you could make copies of documents that show the values of your home and others. Pictures can also show any damage to your house that lowers the value of your home, or receipts showing that any improvements you've made are minor.
Ask about next steps when you file the paperwork. The assessor may have a certain time frame to respond to your request and send their decision.
6. Check for Property Tax Relief Programs
Tax relief programs release homeowners from paying some or all of their taxes based on their eligibility. For instance, a senior citizen or low-income resident may qualify to exempt a portion of their home value from their tax bill.
The details vary in every state and county, but you can look for these programs if you don't think you'll qualify for an appeal or your attempt is unsuccessful. Or, you could do both: appeal the assessed value of your home and apply for tax relief to save even more money.
Research these options on your local tax office website or in person. Read through the requirements to see if you qualify and what you'll need to do to apply. Then you'll complete the application and include documentation that shows you qualify, such as a pay stub that shows your income or birth certificate that shows your birthdate.
The Bottom Line
Your credit history doesn't impact your property taxes, but improving your credit score could help you reduce your home-related bills in other ways. For instance, strong credit can help lower your homeowners insurance rate if your insurer uses a credit-based insurance score to calculate premiums. You may also qualify for a better interest rate if you decide to refinance your mortgage.
Check your credit score to get an idea of where you stand now and if you've improved your credit since you first bought your home. Then take steps to build your credit based on the areas you see in your credit report that need to be addressed.
This process can take time, but you could end up saving thousands of dollars over the course of your time living in the home.