5 Questions to Ask Before Appealing Your New Jersey Property Taxes

by: Anthony F. Della Pelle
8 Dec 2016

homeowner-savingsAs the year begins to draw to a close, it’s common for many of us to start thinking about ways to save money in the coming year.  Real property taxes are usually the second biggest expense for homeowners, trailing only the expense of a mortgage.  If it has been a while since you’ve thought about your property tax bill, there’s a chance that you may be  paying more than your fair share in property taxes. Assessments often don’t reflect a property’s true market value and consequently cause property owners to overpay, in some cases by thousands of dollars. In order to remedy this over payment, you can appeal your tax assessment. Before you do so, however, it’s critical that you ask the following questions:

  1. What Value is the Property Currently Assessed at?

Prior to starting the tax appeal process, you first need to know your property’s current assessment. Notices containing a property’s assessment are usually mailed by New Jersey municipalities in late January or early February, so they’ll be on their way in several weeks. It is also important to know the applicable ratio to true value in your municipality for each year, which is used to “equalize” the assessment. Understanding your present assessment is the first step in determining whether your property is being over-assessed.  And it can be especially tricky in towns where the “equalization” ratio is less than 100%, because the assessment may give a property owner a false sense of comfort that he or she is being assessed fairly when, in fact, the equalized assessment indicates that the property is OVER assessed and ripe for an appeal.

  1. When was the Property Last Reassessed?

Often times, assessments lag behind current real estate market trends. If your property was last assessed three years ago and markets have deteriorated since then, it may be beneficial to file a tax appeal.tax-collector

  1. Is the Property Currently Under-Assessed?

Contrarily, situations do arise where a property’s value may have risen since it was last assessed. In such cases, filing a tax appeal could potentially increase your property tax assessment. It’s crucial to be aware of market behaviors to ensure that you don’t wind up with a higher tax bill.

  1. What Have Similar Properties Sold for Recently?

Sales of similar properties are generally the best indicators of a property’s value. When presenting your case to the Tax Board, providing salient evidence is essential. In order to so, you need to find recent comparable sales in your area.

  1. Should I Look for Assistance?

Property tax appeals can often be complicated and time-consuming. In order to be successful, it’s important that you’re compliant with state-sanctioned deadlines and procedures. In cases where thousands of dollars may be on the line, it may be prudent to seek outside help. An experienced property tax appeal attorney can provide assistance by ensuring your tax appeal is filed appropriately and supported by competent evidence.  In New Jersey, appeals usually need to be filed on or before April 1st each year, but there are a few exceptions to this rule.  This, and other specific procedures, can often cause headaches for folks who try to appeal their own taxes without hiring experienced counsel or without at least familiarizing themselves with some of the rules and regulations.    That’s why it is critical for New Jersey property owners to know the applicable rules or to work with someone who does!

The author acknowledges the assistance of John Oettinger, a summer intern at McKirdy & Riskin, in preparing this article.  Mr. Oettinger is a member of the Class of 2018 at the University of Michigan’s Ross School of Business.