Category: Property Taxes

Time to file your Homestead Exemption!

It’s that time of year to remind everyone who bought a home in 2018 to make sure you send in the information to get your homestead exemption filed. Please DO NOT pay to have this done; it’s free to file and can be done in just a few minutes. Check out the info below for details.

WHY IS FILING THE HOMESTEAD EXEMPTION IMPORTANT TO ME?

If you purchased a home that you occupy as your primary residence, you are entitled to the property tax exemption. I am sure you take as many IRS tax deductions as you are allowed; this is a similar concept. The exemption reduces a homeowner’s property tax bill by removing part of the home’s value from taxation.

For example, your home is appraised at $100,000, and you qualify for a $25,000 exemption (this is the amount mandated for school districts), you will pay school taxes on the home as if it was worth only $75,000. Taxing units have the option to offer a separate exemption of up to 20 percent of the total value.

Once you receive the exemption, you do not need to reapply unless the chief appraiser sends you a new application. In that case, you must file the new application. If you should move or your qualification ends, you must inform the appraisal district in writing before the next May 1st.

HOMESTEAD CAP- BONUS!!!

When the local Counties economy thrives, property values can increase by 20%, 25% and even 30% in a year. We have been experiencing this in the Austin area over the last several years. The Homestead Cap is an amazing feature in the fact that it restricts the amount that the assessed value of a residential property may increase from year-to-year! The appraised value can go up a maximum of 10% each year until it reaches the full market value.

Appraisal districts are required to appraise properties at their fair market value as of January 1 of each year. You qualify to have your appraised value capped if the property is your primary residence and you have had exemptions in place for two years. This means that the property will be appraised at full market value for the first year that you qualify and receive a homestead exemption.

When you qualify for a homestead cap, the second year you own the home, your market value and appraised value may not be the same. The market value may increase by any percentage over the previous year, but the “cap” makes sure that you are not taxed on an increase of more than 10%. Without the Homestead Cap it’s no-holds-barred!

WHAT IF I HAVE OWNED MY HOME FOR YEARS AND NEVER FILED?

You may file an Application for Homestead Exemption with your appraisal district for the $25,000 homestead exemption up to two years after the taxes on the homestead are due. You should go ahead and file in order to possibly get a refund for the last two years and also to get the assessed value cap in place!

DO NOT WAIT TO FILE!

If you recently bought a home a just read that you have two years to file, DO NOT WAIT. I cannot tell you how many people have forgotten to file and have lost thousands of dollars! Carve out a few minutes to get this done online.

HOMESTEAD EXEMPTION REQUIREMENTS?

• You must own your home on January 1st of the year for which you are applying.

• You must reside at the home as your principal residence on January 1st of that year, and not claim any other property as homestead.

• Only individual homeowners (not corporations or other entities) may receive a homestead exemption.

• A homestead can be a house, condominium or a manufactured home. It can include up to 20 acres, if the land is also owned by the homeowner and used as a yard, or for another purpose related to the residential use of the home.

HOW TO APPLY:

I have provided links to a few of the counties in the Austin area. CLICK HERE for the downloadable version of the Homestead Exemption Form for the State of Texas which can be mailed in to the County along with the required additional documentation (see appropriate county website for details as they will deny your application if not submitted correctly).

Travis CountyAPPLICATION LINK

Mailing Address:

P.O. BOX 149012

Austin, TX 78714

Travis Central Appraisal District Website: https://www.traviscad.org

Williamson CountyAPPLICATION LINK

Mailing Address:

625 FM 1460

Georgetown, TX 78626

Williamson Central Appraisal District Website: https://www.wcad.org

Hays County   APPLICATION LINK

Mailing Address:

21001 IH 35 North

Kyle, Texas 78640

Hays Central Appraisal District Website: https://www.hayscad.com

Tips For Protesting Property Taxes

It is that time of year again and I’ve been fielding questions about property taxes. There has definitely been an increase in values in Texas cities, but that doesn’t mean the value the county appraisal district has for your home is correct. Below is the information I posted last year, which outlines the steps to protest the value. The most important thing to take is data and documentation. Good luck, Adam

Are you one of everybody in Travis County who received a notice this week that your home’s appraised value is higher than last year? I usually protest appraised value on at least one of my properties every year, and I’m generally successful. The steps included in how to protest property taxes are:

    1. As quickly as you can, send in the form on the back of the notice to protest the property taxes. There is a deadline, you don’t want to miss your opportunity. If you request a protest, you don’t have to follow through with it if for some reason you change your mind.
    2. If you purchased your home in 2014 and it appraised higher than the price you paid, make a note of this. With a copy of the settlement statement, they’ll usually simply lower it to the price you paid. You are not obligated to provide them with any information, so if the appraised value is lower than the sales price it is a good time to stay quiet.
    3. When sending in the protest form, make sure to request the data the county appraisal district used to assess your home. They are required to provide it if you ask for it.
    4. After a long time, the county will reply with a notice of a date for an informal protest and a formal protest. They will also include a packet with their details about your home as well as a spreadsheet of the comparison homes they used to arrive at their data.
    5. Make sure the data they have for your home is accurate. I’ve had properties where the square footage in the county records was larger than the actual square footage. Simply showing the square footage calculations from the appraisal lowered the appraised value not only for that year, but going forward. Other inaccuracies might include the condition of the property or structures that are no longer there. This also can go the other way, which you may not want to bring the assessor’s attention with a protest.
    6. Make sure the properties they are using for comparison are actually similar to your property. The comps should be of the same type and within the same neighborhood. I’ve had single family houses incorrectly compared to commercial property, much larger properties, duplexes and properties in other non-comparable neighborhoods.
    7. Find properties that are more comparable and support a lower value. The best data is closed MLS listings from your immediate neighborhood. Most real estate agents are more than happy to help with locating these. Of course, these listings must support a lower value. It is very possible that the values in your neighborhood have gone up and the tax assessor is correct.
    8. Make notes of all items with your property that may negatively affect your home’s value compared to any higher valued properties, especially items that won’t show up on their spreadsheet. For example, do the comparable properties have similar-sized lots but your lot has a portion that is not buildable due to a flood plain, terrain or irregular shape? Is your lot on a busy road, adjacent to commercial buildings? Does it lack the view that other nearby properties might have? Have the comparable properties been updated and remodeled or expanded while your house has not?
    9. By state law, the value the appraisal district is considering is as of January 1 of this year, so what is important is the condition of the property at that time. Comparable properties from the previous year can be used.
    10. Attend the informal hearing with data, and reschedule it if the time they assigned you doesn’t work. This hearing is a meeting with a county appraiser in his or her cubicle. Usually there will be an unhappy property owner with no data ranting at the appraiser in the adjacent cubicle. That approach will not be successful, and the appraiser will be happy to have someone in front of them not doing that. Show the appraiser everything to support your claims. He or she will want copies of anything that they use to update your file. Photographs are helpful, as are documentation of closed sales and maps. I have found the county appraisers very reasonable when they have data to review. However, they will never take your word for it that you think your house isn’t worth that much and they should just lower that value right now.
    11. If you are not successful and still feel you have a good case and good data, you can move on to the formal protest. This is a hearing with a county appraiser on one side and you on the other. Three paid, citizen appointees listen to documentation from both sides and vote on an outcome. I’ve had three formal hearings. Two were successful, with the appointees asking relevant questions of both sides and considering the documentation. The third was unsuccessful and featured one of the appointees who couldn’t do simple math and one who fell asleep during the hearing.
      It doesn’t cost anything other than time to protest, and a successful protest may lower your taxes this year and in future years if there is incorrect information in the county records. If you do not want to spend the time to protest, there are services that will protest your taxes and their fee is a portion of the savings.

My opinion is generally that you know your neighborhood and property better than anyone else, and generally you will make your own best advocate. Good luck, Adam Stephens NMLS 216606

Protesting County Property Tax Values

How To Protest Property Taxes

Are you one of everybody in Travis County who received a notice this week that your home’s appraised value is higher than last year? I usually protest appraised value on at least one of my properties every year, and I’m generally successful. The steps included in how to protest property taxes are:

  1. As quickly as you can, send in the form on the back of the notice to protest the property taxes. There is a deadline, you don’t want to miss your opportunity. If you request a protest, you don’t have to follow through with it if for some reason you change your mind.
  2. If you purchased your home in 2013 and it appraised higher than the price you paid, make a note of this. With a copy of the settlement statement, they’ll usually simply lower it to the price you paid. You are not obligated to provide them with any information, so if the appraised value is lower than the sales price it is a good time to stay quiet.
  3. When sending in the protest form, make sure to request the data the county appraisal district used to assess your home. They are required to provide it if you ask for it.
  4. After a long time, the county will reply with a notice of a date for an informal protest and a formal protest. They will also include a packet with their details about your home as well as a spreadsheet of the comparison homes they used to arrive at their data.
  5. Make sure the data they have for your home is accurate. I’ve had properties where the square footage in the county records was larger than the actual square footage. Simply showing the square footage calculations from the appraisal lowered the appraised value not only for that year, but going forward. Other inaccuracies might include the condition of the property or structures that are no longer there. This also can go the other way, which you may not want to bring the assessor’s attention with a protest.
  6. Make sure the properties they are using for comparison are actually similar to your property. The comps should be of the same type and within the same neighborhood. I’ve had single family houses incorrectly compared to commercial property, much larger properties, duplexes and properties in other non-comparable neighborhoods.
  7. Find properties that are more comparable and support a lower value. The best data is closed MLS listings from your immediate neighborhood. Most real estate agents are more than happy to help with locating these. Of course, these listings must support a lower value. It is very possible that the values in your neighborhood have gone up and the tax assessor is correct.
  8. Make notes of all items with your property that may negatively affect your home’s value compared to any higher valued properties, especially items that won’t show up on their spreadsheet. For example, do the comparable properties have similar-sized lots but your lot has a portion that is not buildable due to a flood plain, terrain or irregular shape? Is your lot on a busy road, adjacent to commercial buildings? Does it lack the view that other nearby properties might have? Have the comparable properties been updated and remodeled or expanded while your house has not?
  9. By state law, the value the appraisal district is considering is as of January 1 of this year, so what is important is the condition of the property at that time. Comparable properties from the previous year can be used.
  10. Attend the informal hearing with data, and reschedule it if the time they assigned you doesn’t work. This hearing is a meeting with a county appraiser in his or her cubicle. Usually there will be an unhappy property owner with no data ranting at the appraiser in the adjacent cubicle. That approach will not be successful, and the appraiser will be happy to have someone in front of them not doing that. Show the appraiser everything to support your claims. He or she will want copies of anything that they use to update your file. Photographs are helpful, as are documentation of closed sales and maps. I have found the county appraisers very reasonable when they have data to review. However, they will never take your word for it that you think your house isn’t worth that much and they should just lower that value right now.
  11. If you are not successful and still feel you have a good case and good data, you can move on to the formal protest. This is a hearing with a county appraiser on one side and you on the other. Three paid, citizen appointees listen to documentation from both sides and vote on an outcome. I’ve had three formal hearings. Two were successful, with the appointees asking relevant questions of both sides and considering the documentation. The third was unsuccessful and featured one of the appointees who couldn’t do simple math and one who fell asleep during the hearing.

It doesn’t cost anything other than time to protest, and a successful protest may lower your taxes this year and in future years if there is incorrect information in the county records. If you do not want to spend the time to protest, there are services that will protest your taxes and their fee is a portion of the savings. My opinion is generally that you know your neighborhood and property better than anyone else, and generally you will make your own best advocate. Good luck, Adam Stephens NMLS 216606