Property taxes seem to keep increasing despite all the rhetoric for budget cutting. Substantive local budget cutting issues never seem to make it on the ballot, at least not in my Township. In my opinion there should be a good 10 cost cutting initiatives on the ballot each election.
Nevertheless, declining property values equals a higher tax rate. With the credit crunch and the declining tax base of lower priced homes, homeowners will have to fork over a larger portion to the taxman.
Still you have a good chance to win a tax appeal. It should be easy to find less expensive comparables of sold homes to make your case.
With the massive tax increases that are in store, the amount of winnings on appeal will be larger … and with a win the new derived assessment will roll over and result in future years of tax savings.
It’s unanimous, higher taxes are the result of high levels of spending. The power of the ballot is dead when meaningful tax cutting and budget cutting measures are suppressed and not listed on ballots. The taxpayer consensus of opinion is left out of the equation and it’s business as usual in most American towns.
As a U.S. senator quipped, “The marvel of all history is the patience with which men and women submit to burdens unnecessarily laid upon them by their governments.”
The slowdown in residential construction means fewer homes will be added to the tax role. Budget pressures are bringing higher taxes much to the consternation for the homeowner. Homeowners wonder how can their taxes increase when their home values are go down.
There is no tax revolt because there is NO POWER in the ballot box. Many find it outrageous that voters don’t get to vote out budget increases and government union excesses.
An interesting editorial coming out of Roanoke VA pointed out that property taxes are an antiquity that belong in a museum. The article pointed out that property taxes made sense when only the wealthy owned taxable houses, but now with widespread homeownership, it should be abolished.
As historian John Steele Gordan said in a 2006 commentary on Marketplace, the property tax is "a relic of the colonial past and should be abolished." He said it should be displayed in the Smithsonian "along with other relics like chamber pots and clay pipes." http://www.roanoke.com/editorials/wb/157290
Property taxes, the article argues, bears o relation to the taxpayer’s ability to pay. The working poor are often imprisoned by arbitrary high property assessments. Minimum wage homeowners have little resources, time or means to fight the system. Budget increases and tax hikes unfortunately increase the burden on the already poor.
The alternative would be a state tax. It would be simple and fair. The local tax departments could be fired. Expensive blanket assessments would be abolished saving millions of wasted dollars.
Have you noticed a gallon of milk is up nearly 20 percent than a year ago? Bread is more expensive to say nothing of heating and fuel costs.
Is it recession or inflation? In a recession people shut their wallets and worry about losing their jobs. In inflation, the price of everything goes up but you still have a job.
A quip from Mellon economist Allan Meltzer put it this way, “Capitalism without failure is like religion without sin. It doesn’t work.”
In the political world, no one is taking the side of the taxpayer, so it seems. No one is working against the lobbyist influence that pedals deals in Washington, who sell your inheritances of stability and honest dealings for a percentage. They are responsible for giving corporations billions in tax cuts when they outsource jobs all the while selling often inflated insider deals to political representatives.
Some of the inflationary forces at work are high ethanol subsidized energy prices, the tax cuts for multinationals outsourcing and exporting jobs overseas and bailouts of financial institutions associated with the real estate market.
They are talking about a bailout for foreclosed homeowners with a program that would create "negative equity certificates." I bet the taxpayers are just jumping up and down in terror while the mortgage companies roll in laughter with the promise of government guarantees.
Inflation may be dampened by small recession in the short run … if that is in the cards. But, long run, it looks like business as usual. None of the political parties want to cut expenses and clean up the landscape.
With home prices declining, the property tax bite is not going to decrease. If anything, it will increase do to the nature of government. At lease here in New Jersey, government has insulated itself in archaic unionism and privilege coupled with impulse spending with little to no oversight. State business buy favorable treatment for new spending from politicians using campaign contributions.
Many authorities tell us that there are 40 to 60 percent chance of error in our property tax assessments. That may inspire some to appeal their residential property taxes.
Before you appeal you property taxes, pull up and arm yourself with information about sales prices of similar homes, homes that look like yours and are in the same general neighborhood. Use an assessment worksheet in order to make adjustment plus or minus for amenities that comparable properties have or lack when compared to your home.
If you do it yourself you get a free assessment worksheet and professional advice and hands on training making your appeal using the manual provided from http://www.propertytaxax.com
The only other choice is to wing it or pay over $1,000 for an appraiser and lawyer to represent you.
The tax assessor staff uses their own data to build their case. You can hire an appraiser for an market analysis and usually he has to be present at a municipal hearing. It can be expensive. Some recommend a Realtor for a market analysis but this usually gets shot down at the hearing since little back up material is presented and itemized adjustments are not focused on as points of contention. My experience is that the Realtor is looked at as a second class professional when it comes to trusting his valuation opinion.
The cost effective method is to do your own appeal. When you win your property tax appeal you get a reduction in valuation from the board of equalization and get your tax bill adjusted or get a refund of taxes previously paid.
Overall property taxes seem to be increasing while property values are decreasing and unless the local municipal government and state government economize, taxes will simply increase. Unless there emerge a groundswell of public protest and spending caps on the ballot, spend and tax are the operable engine. Unless there is a percentage cap on spending at every level of government, it’s like giving your teenage son or daughter a credit card and letting them do with it as they will.
Indiana Property Taxes
Indiana property taxes has increased on the average of 8 percent in recent years. 55 percent of homeowners pay property taxes in excess of 1 percent of the value of their home.
The best remedy is to challenge your property taxes. Reducing your property taxes stands a good chance since there are good odds you are over assessed according to many experts. The best way to look over this leading guide for a homeowner to make his case at PropertyTaxAx.com
There is a move to capping homeowner property taxes at 1 percent of assessed value and raising the state sales tax by 1 percent instead of cutting out the fat. The politicians cry that they are scared of being put into a straightjacket when that is EXACTLY what they need.
"If a man were permitted to make all the ballads, he need not care who should make the laws. Ancient legislators knew they could not reform the manners of a city without the help of a songwriter and a poet." – Andrew Fletcher, to Scottish Parliament in 1704
In the fight between the good, the schemers and the evil of deed, there is no autopilot system to reform local, state and federal politics made it's appearance.
http://www.wizardacademypress.com/shopexd.asp?id=37 makes an interesting discussion on visual and auditory messaging to get ideas on the radar screen. Poets and musicians may find useful neurological insights to further their emotional triggers to bold political statements.
Short of political talent, I can only point out the failings of Big Brother that cause tax increases to fund some of their incompetence. Big tax California, Massachusetts and New Jersey are creating a economic climate for workers and businessmen to exit the state.
The ridiculously high-tax cost of doing business for the businessman is becoming economically burdensome. The cost of living for the worker is becoming exorbitant and a stretch for keeping even. Free market forces have been challenged by an insidious political landscape. We find a high-tax bureaucracy with tentacles of job protected workers. Notice that these bureaucrats don't have to show a profit or cost effectiveness to justify their jobs most of the time; they are just there collecting their paychecks.
That protectionism seems to foster mediocrity, featherbedding and workplace complacency. When city workers and cops are making $75,000 and more and get pensions off after 20 years service while the rest of working America have to labor 40 to 45 years before retirement becomes an option. Do we have a fairness problem regarding government union monopoly?
Public Big Brother (one in five work for local, state and the federal government) have their ridiculously compensated wage contracts cemented with early retirement and other perks. Health insurance monopoly legislation and other protected monopolies have placed heavy stones on the backs of taxpayers.
So, when you have a chance to appeal your property taxes … don’t hesitate. Property taxes are incorrect 40-50% of the time. There are ways of looking at things that are not standardized by bureaucrats. Values are often derived erroneously or previous year’s errors rolled over. It pays to take a look.
Home sales have fallen to a 5-year low with existing home sales falling for the 6th straight month. The average home is now on the market for more than 10-months before it is sold. Prices a still falling.
Often a home’s values are lower than the sales price since many concession are made. Before putting it on the market, they may install new carpets, new windows dressings, ceramic tile, new kitchen appliances, redo the kitchen, new ceiling fans, repaint the interior or replace window air conditioner units. If the home still doesn’t sell they may paint the exterior, do extensive landscaping, walkway changes or change entrance features etc.
If after six months on the market, a potential buyer may like some of the home but did not add on features and ask for a price concession. Sellers may have to make numerous financial concessions, not reflected in the sales price to unload their properties. This is a buyers market.
If you sold you a house for $550,000 but gave you $50,000 in concessions, then that house's real value is $500,000. But, since only the sold price is recorded you can’t tell the Department of Revenue that home values is lower than the sales price when you use a comparable in your property tax appeal or appraisal unless you prove it with a study.
The housing glut, increases in property taxes and skyrocketing homeowners' insurance rates are reflected
in the real estate market. Price concessions are hard to prove and a study to prove a lower sold value for the comparable homes due to price concessions is debatable.
Often a home’s actual value is lower than the sales price since many price concession are made. If you are using a comparable sales to determine market value, that figure may in reality be much lower than the actual recorded price indicated.
Where is competent efficient government? Local governments spend a small fortune to reappraise our homes every few years and then hold a gun to our head if the homeowner can't afford to pay for their run away expenses. If the homeowner can't pay they seize the home from under him and sell it. We have absolutely no control of how they spend our money.
There is a FORTUNE spent on collecting property taxes. When you add the expense to collect our property tax money (cost of blanket property tax appraisers, the town tax collector, tax assessor, the cost of the office space, town cars, legal fees to the town lawyer for property tax appeals…. etc. and add it all together, it makes more sense to simply raise taxes with in increase in sales tax and/or income tax.
Politicians nowadays have the mindset that they have to come up with a bill or law they want passed to get elected. Instead they should point with pride to all the unnecessary expenses, jobs and bureaucratic overhead they got rid of.
We need politicians of a culture that says "NO!" to extra-ordinary expenses. Obvious expenses and savings abound. And then there are the bureaucratic perks such as the 20-year service and retire on a pension civil service contracts while the average American has to work 40 or more years before they get the chance to kick back. Or the over-the-top health and welfare benefits that the private sector simply can not afford.
