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Property Tax Appeals 2010

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Property taxes are one of the greatest expenses associated with property ownership, and they are ever increasing. Many owners are unaware that in each state and county, there is a legal right to challenge one’s property valuation and that process can result in a reduction of your taxes and in some cases, a refund of taxes already paid.

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Property Tax Appeals 2010

  1. 1. Property Tax Valuation Appeals in Ohio Sponsored by the law firm of Finney, Stagnaro, Saba and Patterson Co., L.P.A. Reducing Your Property Tax Bill
  2. 2. Presenters: Reducing Your Property Tax Bill
  3. 3. <ul><li>Real Estate </li></ul><ul><li>Corporate </li></ul><ul><li>General Litigation </li></ul><ul><ul><li>Business disputes </li></ul></ul><ul><ul><li>Personal injury and medical malpractice </li></ul></ul><ul><ul><li>Constitutional law </li></ul></ul><ul><ul><li>Labor and employment law </li></ul></ul><ul><li>Wills, trusts, estate planning and estate administration </li></ul><ul><li>Real estate tax valuation appeals </li></ul>Finney, Stagnaro, Saba & Patterson Reducing Your Property Tax Bill http://www.fssp-law.com
  4. 4. What The Packet Contains Reducing Your Property Tax Bill <ul><li>Right Pocket: </li></ul><ul><li>F inney, Stagnaro, Saba & Patterson Co., L.P.A. </li></ul><ul><li>Brochure </li></ul><ul><li>Course Outline </li></ul><ul><li>Real Estate Tax Analysts Flyer </li></ul><ul><li>Right Pocket: </li></ul><ul><li>Tax Graphs </li></ul><ul><li>Homestead exemption application </li></ul><ul><li>Tax chart by jurisdiction </li></ul><ul><li>Blank and completed Board of Revision Complaint forms </li></ul><ul><li>Comparable Sales Presentation </li></ul>
  5. 5. <ul><li>Benefit: First $25,000 of home’s value is exempt from taxation (worth about $500 per year in tax reduction) </li></ul><ul><li>Who is eligible: </li></ul><ul><ul><li>Single family residence/Owner occupied </li></ul></ul><ul><ul><li>Any one owner who is either over 65 years old or permanently disabled </li></ul></ul><ul><ul><li>Property held in trust is an issue </li></ul></ul><ul><li>When is application due? June 1, 2011 </li></ul>Quick Diversion on Homestead Exemption Reducing Your Property Tax Bill
  6. 6. … and, what can I do about it? Why are my property taxes so high… Reducing Your Property Tax Bill
  7. 7. Year Residential Effective Rate Mills A. Property Tax History in Hamilton County Reducing Your Property Tax Bill http://www.fssp-law.com
  8. 8. B. History & Projection of taxes (City of Cincinnati, Cincinnati Public Schools) Reducing Your Property Tax Bill
  9. 9. C. Comparison to Surrounding Counties Reducing Your Property Tax Bill http://www.fssp-law.com
  10. 10. D. Major Ohio Counties Reducing Your Property Tax Bill
  11. 11. II. COMPONENTS OF HAMILTON COUNTY PROPERTY TAX BILL How are my taxes calculated? Reducing Your Property Tax Bill
  12. 12. A. Broad calculation of tax bill Reducing Your Property Tax Bill VALUATION x RATE – ROLLBACKS = TAX
  13. 13. Valuation is the one variable you can influence B. The Valuation Component Reducing Your Property Tax Bill http://www.fssp-law.com
  14. 14. <ul><li>C. What valuation reduction means </li></ul><ul><li>Valuation reduction results in proportionate reduction in taxes </li></ul><ul><li>A reduction of $10,000 in value will result in $200 of ANNUAL tax savings </li></ul>Reducing Your Property Tax Bill
  15. 15. <ul><li>What valuation reduction means (cont.) </li></ul><ul><li>3. Savings last AT LEAST through the end of the triennial </li></ul><ul><ul><li>Hamilton, Clermont and Butler Counties this is the last year in the triennial </li></ul></ul><ul><ul><li>Warren County—2011 is second year of new triennial so savings in 2011 will last for at least two years </li></ul></ul>Reducing Your Property Tax Bill
  16. 16. <ul><li>The Assessment Challenge </li></ul><ul><li>Hamilton County has 1,300 different appraisal districts </li></ul><ul><li>Hamilton County has 350,000 separate Auditor parcels to be assessed </li></ul>
  17. 17. D. Rate Consists of Various Components Reducing Your Property Tax Bill <ul><li>Review of prototype Hamilton County tax bill </li></ul><ul><li>3630 Zumstein Ave, owned by Mark Miller </li></ul>2. Overview Chart of tax breakout http://www.fssp-law.com
  18. 18. First Half  Calculations Tax Distributions 1/5/2010 Half Year Real Taxes + Delq Real Estate (if any) 3630 Zumstein Avenue, Cincinnati, Ohio Reducing Your Property Tax Bill
  19. 19. Property Value and Rate 3630 Zumstein Avenue, Cincinnati, Ohio Reducing Your Property Tax Bill Reduction Factor 0.332776
  20. 20. Calculations for 3630 Zumstein Avenue Reducing Your Property Tax Bill http://www.fssp-law.com
  21. 21. Tax Distributions for 3630 Zumstein Avenue Reducing Your Property Tax Bill Percent 65% 15% 5% 4% 3% 2% 2% 2% 1% 1%
  22. 22. Tax Distributions for 3630 Zumstein Avenue Reducing Your Property Tax Bill
  23. 23. III. Complaint form and filing procedures A. Critically important dates B. The 35% issue – they do it to confuse you C. Review of Complaint form and its completion D. Presentation of case at Board of Revision E. Risks to complainant F. Procedural issues G. Appeal procedures Reducing Your Property Tax Bill http://www.fssp-law.com
  24. 24. <ul><li>Tax lien date: 1/1/2010 </li></ul><ul><ul><li>This is the effective date of the valuation challenged in 2011 </li></ul></ul><ul><ul><li>All of your evidence MUST BE targeted towards proving your property’s value AS OF THAT DATE (not when you get tax bill or have your hearing) </li></ul></ul><ul><ul><ul><li>Lots of cases this year were dismissed because this key issue was missed </li></ul></ul></ul><ul><li>2. Filing deadline: 3/31/2011 </li></ul>A. Critically Important Dates Reducing Your Property Tax Bill
  25. 25. <ul><li>“ True Value” </li></ul><ul><li>“ Full Value” What your house is worth </li></ul><ul><li>“ Market Value” </li></ul><ul><li>“ Fair Market Value” </li></ul><ul><li>“ Assessed Value” 35% of Fair Market Value </li></ul><ul><li>“ Taxable Value” </li></ul><ul><li>Note Again 1/1/2010 Tax Lien Date </li></ul>B. They Do It To Confuse You Reducing Your Property Tax Bill
  26. 26. Reducing Your Property Tax Bill 2010 http://www.fssp-law.com
  27. 27. Reducing Your Property Tax Bill 1/20/2010
  28. 28. Reducing Your Property Tax Bill
  29. 29. <ul><li>Residential </li></ul><ul><li>Actual sales or construction data of the subject property </li></ul><ul><li>Comparable sales are the best evidence </li></ul><ul><li>Listings are of little value </li></ul><ul><li>Auditor’s valuations of others’ properties of NO use </li></ul>D. Presentation at the Board of Revision Reducing Your Property Tax Bill http://www.fssp-law.com
  30. 30. <ul><li>5. Comparable sales (this means SALES , not listings) </li></ul><ul><ul><li>1/1/2010 tax lien date </li></ul></ul><ul><ul><li>Timing: Best sales are 6 months on either side of that date </li></ul></ul><ul><ul><li>Location: Close in location, in the neighborhood or neighborhoods close by </li></ul></ul><ul><ul><li>Size of house and lot: Similar house and lot size </li></ul></ul><ul><ul><li>Age: Similar age of construction </li></ul></ul><ul><ul><li>Bedrooms </li></ul></ul><ul><ul><li>Bathrooms </li></ul></ul><ul><ul><li>Total square footage </li></ul></ul><ul><ul><li>Number of garages </li></ul></ul><ul><ul><li>Amenities like finished basement and pool </li></ul></ul><ul><ul><li>Interior finish and recent renovation </li></ul></ul>Valuation Information to Present (cont.) Reducing Your Property Tax Bill
  31. 31. <ul><li>“ My property did not go up 25% in value in one year” </li></ul><ul><li>Auditor’s value of neighbors </li></ul><ul><li>property is irrelevant </li></ul><ul><li>The only issue is: what the </li></ul><ul><li>property is worth as of the </li></ul><ul><li>“ tax lien date” (January 1 st , 2010) </li></ul>Evidence Presented at the Hearing Reducing Your Property Tax Bill
  32. 32. <ul><ul><li>D. Value is defined in ORC §5713.03, which requires County Auditor to determine the “true value of each parcel of real property” </li></ul></ul><ul><li> E. If Tract is part of on-going arms length </li></ul><ul><li>sale, it is required to accept this as the </li></ul><ul><li>“ true value” ORC 5713.03 </li></ul><ul><ul><li>Unless loss due to casualty; or </li></ul></ul><ul><ul><li>Improvement added </li></ul></ul>Evidence Presented at the Hearing (cont.) Reducing Your Property Tax Bill http://www.fssp-law.com
  33. 33. <ul><li>F. Three valuation techniques: </li></ul><ul><ul><li>Comparable Sales Approach </li></ul></ul><ul><ul><li>Income Approach </li></ul></ul><ul><ul><li>Replacement Value Approach </li></ul></ul>Evidence Presented at the Hearing (cont.) Reducing Your Property Tax Bill
  34. 34. <ul><li>G. Who May Testify: </li></ul><ul><li>Expert Witness (realtor or appraiser) may present valuation issues </li></ul><ul><li>Property owner is always qualified to render opinion as to the value of his or her property </li></ul><ul><li>3. No one else may present evidence </li></ul>Evidence Presented at the Hearing (cont.) Reducing Your Property Tax Bill
  35. 35. <ul><li>H. Property Owner has the burden of proof </li></ul><ul><ul><li>Neither Auditor nor school board have </li></ul></ul><ul><li> a duty to introduce any evidence at the </li></ul><ul><li>hearing, except to rebut what property </li></ul><ul><li>owner accepts </li></ul><ul><li>2. The Board of Revision does not even </li></ul><ul><li>have the duty to accept evidence </li></ul><ul><li>tendered by the property owner </li></ul>Evidence Presented at the Hearing (cont.) Reducing Your Property Tax Bill http://www.fssp-law.com
  36. 36. <ul><li>Auditor can go back five years to </li></ul><ul><li>make corrections to errors, or until </li></ul><ul><li>conveyance. </li></ul><ul><li>(Whichever is shorter) </li></ul><ul><li>-Omitted tax </li></ul><ul><li>-ORC §5713.20 </li></ul><ul><li>Board of Revision can increase valuation </li></ul><ul><li> in its proceedings </li></ul><ul><li> *Note frequent school board countercomplaints. </li></ul><ul><li>( Expect same on commercial properties) </li></ul>E. Risk to Complainant Reducing Your Property Tax Bill
  37. 37. <ul><li>Board of Revision </li></ul><ul><ul><li>Composition </li></ul></ul><ul><ul><ul><li>Representatives of County Auditor, County Commissioners and County Treasurer </li></ul></ul></ul><ul><ul><ul><li>Note conflict of Auditor as original assessor, “prosecutor” and judge </li></ul></ul></ul><ul><ul><ul><li>In the outlying counties, frequently these elected officials will serve in person </li></ul></ul></ul><ul><ul><ul><li>Some claim that political pressures of school </li></ul></ul></ul><ul><ul><ul><li>boards or “inertia” of protecting </li></ul></ul></ul><ul><ul><ul><li>established values </li></ul></ul></ul>F. Procedural Issues Reducing Your Property Tax Bill
  38. 38. 2. Jurisdiction a. Handling appeals of property valuations within their jurisdiction. Procedural Issues (cont.) Reducing Your Property Tax Bill
  39. 39. 3. Procedures a. Values of the Auditor for a tax year are made in December of that tax year, after the tax levies from that year are certified b. Filing deadline of March 31 for preceding tax year (December valuation) c. Only one appeal during a triennial, unless there has been a material change in the property during that time such as improvements, casualty or loss of a major tenant Procedural Issues (cont.) Reducing Your Property Tax Bill http://www.fssp-law.com
  40. 40. <ul><li>A. Accelerates filing to before tax due date </li></ul><ul><li>If prevail, no interest and penalties </li></ul><ul><li>If lose, interest applies and if bill increases from about originally billed, penalty will apply </li></ul><ul><li>Note: Danger of tender pay on multiple parcels. A win can still result in penalties and interest </li></ul>Website: www.fssp-law.com Tender Pay at Filing
  41. 41. <ul><li>Forum: Either to Common Pleas Court where property is located or Board of Tax Appeals </li></ul><ul><li>Trial de novo at Board of Tax Appeals- new evidence allowed </li></ul><ul><li>Filed appeal to Board of Revision and appellate jurisdiction, 30 days after mailing of BOR decisions </li></ul><ul><li>Appeal from either of those to the Ohio Supreme Court </li></ul>G. Appeal of Board of Revision Decision Reducing Your Property Tax Bill
  42. 42. <ul><li>CAUV. “Current Agricultural Use Valuation” </li></ul><ul><li>ORC §5713.31 </li></ul><ul><li>Note: Partial recoupment on sale </li></ul><ul><li>Forestry. ORC §5713.23 </li></ul><ul><li>1. By completing an application </li></ul><ul><li>with Ohio Department of </li></ul><ul><li>Natural Resources </li></ul><ul><li>2. If devoted exclusively to forestry or timber owner, tax rate </li></ul><ul><li>is ½ of typical rate </li></ul><ul><li>3. Is accompanied by physical inspection by ODNR </li></ul>IV. Other Statutory Savings Reducing Your Property Tax Bill
  43. 43. <ul><li>Homestead Exemption </li></ul><ul><ul><li>1. Reduction for senior (65 or older) </li></ul></ul><ul><ul><li>or disabled citizen, regardless of </li></ul></ul><ul><ul><li>income, on dwelling that is </li></ul></ul><ul><ul><li>individual’s principal place </li></ul></ul><ul><ul><li>of residence and up to 1 acre </li></ul></ul><ul><ul><li>2. Exemption is equal to the amount of tax that would be charged </li></ul></ul><ul><ul><li>on up to $25,000.00 of market value </li></ul></ul><ul><ul><li>3. Must own and have occupied home on Jan. 1 of the year in </li></ul></ul><ul><ul><li>which you file. </li></ul></ul><ul><li>D. Tax Abatement Programs </li></ul>Other Statutory Savings (cont.) Reducing Your Property Tax Bill
  44. 44. V. Conclusion Reducing Your Property Tax Bill A. Thank you for coming B. Go save some money C. Let us know if you want us to assist you in your filing http://www.fssp-law.com

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