Homeowners must come prepared to protest property taxes
As a member of the Almont Township Board of Review I think it is prudent for the public to receive as much informational help as possible in dealing with the state of their current property tax bill.
Just around the corner Boards of Review from every township and city within the State of Michigan will be opening their doors to the general taxpaying public. For years taxpayers have had the opportunity to address changes in their tax bill in a rising real estate market. For the past two to three years they have seen a dramatic change. Real estate markets have been in a free-fall with bankruptcies and foreclosures littering a declining market. In a normal real estate market if a taxpayer (homeowner) was overextended and could no longer afford their home they could sell it and basically start anew. In this declining market the availability of homes for sale is so massive that most homeowners have no luck selling even if they discount the price.
One opportunity that can assist homeowners trying to survive is to protest their property taxes directly to their local government through their local Board of Review. However, most homeowners have never appeared before their board and don't realize that the burden of proof falls directly in their own lap. Most taxpayers come to their appointment completely unprepared. I can't tell you the number of times a taxpayer has appeared before myself and fellow board members simply stating that they think their taxes are too high. While in many cases the Board of Review may agree with their statement it basically gives us nowhere to stand. What a taxpayer needs to do is their homework.
A Board of Review needs information that proves, or at least supports the notion that the taxpayer is paying a property tax bill that exceeds the value of their property. The support can be found by securing one of two things, either a residential appraisal by a qualified state licensed appraiser or comparable homes of similar size and amenities pulled from an Internet real estate multilisting service.
A residential appraisal carries a tremendous amount of weight when presented to the Board of Review or the Michigan Tax Tribunal by the grievous taxpayer. If an appraisal is the route the taxpayer chooses it would be a wise move to select the appraiser that lives in the taxpayer's township. An appraiser that enters a township unfamiliar to him or her is at a distinct disadvantage in acquiring information and comparable properties. The out-of-town appraiser is also completely uneducated as to the economic condition of the area he is about to do a report on. Of course, if you are going to pay an appraiser to complete a report for tax protest you want the advantage to be in your favor.
An appraisal is no guarantee that the Board of Review will feel you are correct in protesting your current property tax bill. However, as I said earlier, an appraisal carries tremendous weight. In fact, I would say that it would be the most important collection of information that you could supply to your Board of Review to prove your point.
Another way to approach the information problem with the Board of Review is to supply them with comparables to your home. Again...see your local appraiser. While they would much rather have you hire them to do an appraisal they will also simply pull the comparables you need for a smaller fee. But whatever course you choose, do not appear before the Board empty-handed simply stating..."I'm here because I believe my property taxes are too high!" You will receive a polite smile and that is about it.
It has been impossible for anyone to miss what has happened to our real estate markets over the past two and half years. The market is in tatters. Homes in the State of Michigan have lost 30% to 40% of their value over the past 30 months. Foreclosed homes are selling for 40% to 50% below their original value and are forcing the normal homes sales down in final price. Builders and those who finance the homes they build have closed their doors in droves. Requirements for financing have tightened down so heavily that only three out of 10 applicants for mortgages can qualify. Of those three, two will pay a higher interest rate and only one in 10 will get the advertised low interest rate.
Consequently I expect to see a huge volume of taxpayers calling in for their appointment with their local Board of Review. Let me remind those who are entertaining the idea of appearing before their local tax board that it is done only by appointment. Pay attention to your local newspaper. Most Boards of Review run an advertisement for several issues stating whom and where to call for an appointment. Most boards of review meet for several days during the second week of March along with at least one evening of appointments. Last year Almont Township's Board of Review met for approximately 10 days. We try and accommodate anyone who takes the time to call for an appointment. However, the advertisement will have a shut off date on calling for an appointment. If you miss that shut off your only choice will be a letter to the Board. That letter will have to be received by whatever date the Board sets. Usually it is by Friday at 5:00 p.m. of the week the Board is receiving local taxpayers. Check with the township tax assessor.
Speaking of the tax assessor...that is another solution to your tax problem. If you believe your taxes are too high due to a clerical error in the information listed on your valuation sheet call your local assessor. In many cases the assessor can correct the error immediately. This will save you the hassle of appearing before the Board.
All taxpayers should pick up a copy of their properties valuation sheet from your local assessor. This sheet lists all the information about your property that the assessor uses to figure your property taxes. Every taxpayer should pick up a copy of this valuation sheet in January even if you have no problems with the taxes you are currently paying.
The board will also accept a letter from the local taxpayer but again...it must include either an appraisal or comparables pulled by an appraiser. Without the necessary support for your position not much can be expected. Last year the Almont Township Board of Review accepted over 30 letters from taxpayers that could not make the personal appearance for a variety of reasons. These letters by law must be given the same weight as though the taxpayer were sitting in front of the board.
With this economy it is vitally important to every taxpayer to look over their valuation sheet as well as their tax bill and react to problems that need solving. Nobody needs to pay taxes that are not fairly applied. That is the job of the Board of Review. We are there to make sure all property is described accurately and the taxes are applied equally and fairly to all taxpayers.
One last point...if you are unsatisfied with your Board of Review's decision you will have to take it to the next level. The next level is the Michigan Tax Tribunal. The MTT will require the same support or information that is required by the Board of Review for action. If you appear before them with no information you will get the same smile along with no tax cut.
In appearing before any tax board the burden of proof is on the taxpayer. Keep that in mind and you will greatly increase your chances for some relief in your tax position.
Remember, watch your local newspapers for the notice from your local Board of Review. Call and make your appointment and then do your homework.
Thomas G. Sadler, Almont Township Board of Review
February 18, 2009