The Secret to Getting the Best Property Tax Rate

Secret to Lower Property Tax Bill Header ImageAre you getting ready for a formal property assessment? It may not be a typical way to spend your afternoon, but depending on where you live, many homeowners go through it at some point or another. We would all like our homes to appreciate in value, but the results of an in-home assessment can end up having a big impact on your final tax rate (not to mention that of your neighbors).

So what can you do to help lower the bill?

The secret: limit curb appeal.

Your property tax bill is based in part on the value of your house – so the lower the value, the lower your tax. Every locality has its own system for measuring value, but if you get an in-person assessment you’ll have the benefit of being able to influence the result, at least a little.

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After all, there’s not much you can do about a mathematical formula that determines rate increases. Not so when it comes to in-home assessments.

To that end, don’t try to make improvements before the appointment, and don’t worry too much about cleaning up.

You might have the urge to do so, but this is one situation where a good-looking house can work against you. Instead of going to great lengths to tackle those little projects you want to take care of, take a rain check until after the assessment.

Activities worth waiting on can include:

  • Landscaping work
  • New paint
  • Small (or large) repairs
  • Renovations
  • Reinforcing older or damaged areas
  • Adding outbuildings or amenities (such as a pool or shed)
  • Purchasing new appliances

Why is this so valuable? While assessors typically come armed with checklists and comps, to a certain degree value is still a subjective matter. A meticulously clean and updated home will simply feel more expensive than a similar home in more “lived-in” condition.

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Use this psychological reality to your advantage.

Don’t forget to point out damage

 Once your assessment starts, don’t just allow your house to speak for itself: join your assessor and point out damage, problem areas, and aging materials. It’s not every day that you talk about all the problems in your home with a complete stranger, but don’t hesitate: your tax bill is relying on it!

Added together, issues like appliances in need of replacement or a roof that leaks could negatively impact the value of your home – and this is one situation where a lower value could be a good thing.

All of these issues can be addressed later, especially if you’re looking to sell (or if that leak is driving you crazy).

Finally, double check your property card

Your assessment is also a great time to make sure the information on your property card is correct and up-to-date. An assessor will be able to help rectify any mistakes or make changes to the information on your records.

The best part? No waiting in line or on the pone – the person you need to speak to is right there!

Don’t forget to take advantage of these other homeownership benefits

 Did you know that your home can be an important source of tax benefits? Many people know about the mortgage interest deduction, but that’s just one of many tax breaks available to you.

Free Download Your Home is a tax Haven

Learn More

You know that your home can be a powerful part of building wealth, but are you taking full advantage?

Download our free guide to the tax benefits of home ownership.

Let Us Help!

We can discuss this topic and more at a complimentary appointment. As a bay area retirement planning coaches, we can give you a review and make suggestions based on your retirement objectives.

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Important disclosures

The opinions voiced in this article are for general information only. They are not intended to provide specific advice or recommendations for any individual and do not constitute an endorsement by United Planners.

To determine which investments may be appropriate for you, consult with your financial professional. Please remember that investment decisions should be based on an individual’s goals, time horizon, and tolerance for risk.

Neither diversification nor asset allocation can ensure a profit or prevention of loss in times of declining values. United Planners does not render tax advice.

Information for this article was compiled from the following resources:
https://www.irs.gov/uac/about-publication-17-part-5-useful-items
https://www.irs.com/articles/5-popular-itemized-deductions
https://www.irs.com/articles/2016-federal-tax-rates-personal-exemptions-and-standard-deductions
https://www.irs.gov/uac/newsroom/itemizing-vs-standard-deduction-six-tips-to-help-you-choose (please note the specific amounts shown are for a previous tax year)