property tax assessment

thisishishouseMarch 9, 2011

Are there any standards in what spaces are factored into property tax assessments? Is property tax simply a factor of square footage, or does the type/location play a factor too? Does it differ from state to state or community to community?

Assuming equal sizes and finishes, would a family/rec room finished over a garage be taxed differently than one in a basement, or attic?

Likewise, is there a taxation difference between a patio, a deck, a covered porch, screen porch, 3-season porch, enclosed sun room, etc?

Is an attached garage taxed differently than a detached garage? What about a barn or utility structure used as a garage?

Has anyone created or altered their designs based on potential tax impact?

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What an interesting question. I'll be anxious to hear others replies.

We live in an area of very high property taxes (WI), although I know there are other areas of the country that are higher. When we first moved here and purchased our current home, the taxes doubled every year for the first 3 or 4 years we were in the house. My husband happened to run in to the tax assessor at city hall, and questioned him on the assessment. Come to find out, there were many errors on the description/assets he was using for the basis of our assessment. After the corrections, our property taxes were adjusted down 20%.

    Bookmark   March 9, 2011 at 3:44PM
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Just try talking to your local assessor. Apparently the "system" they use to assess is a matter of national security, not to be divulged on pain of death. They will get away with whatever they can and, at least in my town on Long Island, NY, jerk you around as long as possible in the hope that you'll give up and go away. Tax grievances here take YEARS to resolve. Don't even get me started on commercial assessments, which have nothing to do with square footage or value, but are based on the town's "income analysis" of the building. Don't bother to give them the actual numbers, or your own independent appraisal. They don't care. No wonder people are fed up with the whole ridiculous system.

    Bookmark   March 11, 2011 at 3:40PM
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LilFlowers MJLN

In my area in Louisiana, the tax assessor goes to the property and takes a picture. He then collects the information needed through the bill of sales or loan documents filed with the court house. After that, he looks at the location of the house in the parish. Each part of the parish has a different "scale" to which he charges. The closer to the main city you are the higher the taxes you pay. It also goes by square footage and how much land is at the location. For example, we have a house that is 25 minutes from DeRidder which is the seat of Beauregard Parish. Our taxes for the 40+/- acres and a 900 square foot home is $350/yr. Our other house is in a subdivision on 1 acre only 5 minutes from DeRidder with a 1800 square foot house. The total tax is $1500+/yr. It really depends on what your tax assessor goes by. We also have another house on half an acre in a different parish. It is 1300 square foot 5 minutes from a town with less that 2000 people and is only $100/yr. I think it also depends on if you have the house as your primary or secondary home and if you are using secondary houses as rental properties. Hope this helps you a little.

    Bookmark   March 11, 2011 at 5:29PM
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I think you will find it varies widely by region. Basements are assessed lower than above-grade space here. Finished attics are no different than any other finished space. There is a formula for porches (closed vs. open), different from decks, number of fire places, number of bathrooms (and whether it has a shower, tub, etc.), factors for wood or tile vs. carpet, etc. They rank houses by level of finish, which is a total joke. My house is ranked a 10 (the highest) and most here would consider it a normal but nice house.

    Bookmark   March 11, 2011 at 5:56PM
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Thanks for the responses. I get the feeling that the knowledge I seek is unknowable.

lolab: You are 100% correct about it being closely guarded national security. I called my city assessor's office to ask how the amount was calculated. The only answer I could get was "it's just in the system." When I asked to talk to the person who does the actual assessment, I was told that it's not 'policy' for him to interact with customers, and if I have a grievance then there's a form to fill out...Sigh.

TiffanyLA: I looked up my current tax record and there's a picture, and some dimensions, and some codes. But there's no correlation given between those codes and my tax bill. And given your tax bills, I *definitely* live in the wrong place. I have 1800 sq ft house on 1/3rd acre 30 mins outside Boston. My tax bill is ~$5000. And we're in a 'bad' town. Looking at the same home 2 towns over, in the 'nice' town, the same home is $~$9000/yr in taxes. And that's 'old' homes. Avg new construction homes (3000 sq ft, avg finishes) have ~$12,000/yr taxes. Hence, my desire to build a home with a minimal tax impact.

Sue36: While I'd like to believe there's a formula, I'm beginning to seriously think it's arbitrary. I know people with nearly identical houses, in the same subdivision, with tax bil1 differences of 10-20%. A few years back there was a scandal of a local politician whose taxes were like 1/5th his neighbors for years, so obviously there's ways to rig the system.

    Bookmark   March 12, 2011 at 8:07AM
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A 10-20% difference is minor. Minor differences in finishes or quality grading could cause more than that. In Maine a 20% difference in assessment for identical homes is considered acceptable. It needs to be more than that to even have a chance of winning an appeal. There is some sort of formula here, but they can penalize or reward someone based on the quality grade or the way they assess the lot. The lot assessment is pretty arbitrary, from what I can tell. I've seen water front lots worth $350k+ assessed at $50k. Just a coincidence that those people were "townies", of course.

As I said, my house has the highest quality ranking, which is completely ridiculous. An architect-owned house in the same neighborhood, which is FULL of custom details (the house is like a fancy yacht inside) has a lower grade. But my house looks larger from the street and that causes bias in their grading. They have never been in my house.

    Bookmark   March 12, 2011 at 11:49AM
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Not that I'm an expert but this is what we found out this week. The tax advice folks give you may of may not be right because the taxes seem to be different for different towns in the same county. I called the tax assessor and she said if we built in this one part of the county our taxes would be half. HALF. But we aren't building there.

The lumberyard that is providing our materials and blueprint told us that recently another customer was able to get the tax assessor to look at the blueprints and discuss the taxes for his new house.

My husband called the tax office to do this and got the run around. They were rude. By calling the other customer the lumberyard was able to tell us WHO to call at the tax office. The tax assessor herself NOT her staff is the way we had to go. The staff told us they would not help us until AFTER we had the building permit. We are meeting with the tax assessor on Tues. She told us to bring the blueprints and plan to spend an hour. She seemed nice on the phone. Maybe you can find the right person in your system to help you.

We are going armed with all the costs we can add up on this. We have a mtg first with our GC and hope to get the concrete bid tomorrow. I have all the other subs bids.
We are being told by the tax assessor that the square footage matters, the cost, and other factors like number of fixtures that require plumbing, walk outs, if the garage has heat, if the basement has heat, I'm hoping to figure out if we can afford it or need to lose a few rooms.... before we get the building permit.

In our area a $200,000 new home is 5600$ in taxes she told my husband. Ouch.
Good luck.

    Bookmark   March 13, 2011 at 10:03PM
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In the county we live in, we were able to file a rebuttal on our assessment. We were then given an appointment to meet with the assessor downtown at the tax office & supply them with our reasons why the assessment was incorrect--photos/GIS map, location, appraisal from when we purchased the property (it was within 5 years from the date of the assessment), recent similar sales, access, busy road, large creek with flood plain that cut the entire property in half, etc. Approximately 6 weeks later, we received a letter from the assessor stating the new assessment at the amount we paid for the property (we bought it as a foreclosure so that was a sweet deal).

Mom & Dad built their house 4 years ago. The tax assessor in their county started coming out to the building site every month or so about 3/4 of the way through the build to see what was going in. As Mom & Dad were acting as their own GC they were on site and told him he could stay outside but he had no business inside. Afterall, assessors don't go inside your house when they reassess every 10 years and take into account that you've upgraded your 30 year old house to granite & hardwoods from the original early 1980's linoleum & speckled formica.

Too, with the current mortgage crisis and so many foreclosures and values falling, you may not want to let the assessor be privy to your costs & finishes upfront. You may want to wait and see what he values the house at first (without giving him a list of finishes / letting him inside the finished house if at all possible if you're going with some higher end finishes like hardwoods & granite). Then if he comes back with an unreasonable value, file a rebuttal.

Just my 2 cents.

    Bookmark   March 14, 2011 at 12:30AM
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I found good information in this brochure.

Please read the bit about "common Level Range" carefully.

I have been looking into building a house in NJ and it seems (my guess, others have already mentioned that assessment is mostly voodoo) that if the land you are building on, doesn't have city sewerage and water etc. then the land part is assessed significantly lower.

Also, in NJ if you seeking farm assessment, townships insist on using at least once acre even for the smallest of houses as land parcel used for home. So, if you have 10 acres and you build a house, you have to assign at least one acre to the house and rest to farming.

As another FYI - there is a new NJ program in the making, it is called NJ Forest Stewardship program and it will have reduced tax implications if you choose to participate. Current forest preservation program is a federal program and has no tax implications.

    Bookmark   April 22, 2011 at 2:14PM
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Each tax assessor has their own rules.

In places with 'full market value assessment' they almost always hold the values below the true market value.
If they even averaged the actual value some houses would be assessed over the market value, and appeals would clog the system.

A common answer from the assessors in the Northern Virginia area is "Would you sell for the assessed value?"

If you answer no then you are not over-valued.

    Bookmark   April 22, 2011 at 2:19PM
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