Should I challenge my property tax assessment?
If your assessment is too high, then the answer is yes!
- The higher my assessment the more my property is worth.
FACT: Your property is worth only what someone will pay you for it. Many properties are valued for tax purposes, significantly higher than their actual market value. If not challenged then the owner will be paying a greater tax than they should.
- If my assessment is lowered I will not receive as high a price should I decide to sell it.
FACT: The price you receive at a sale is driven by many market conditions and it is likely that a high value set by the tax assessor can only have a negative effect on the sales price as if it is too high, the taxes will also be too high, thereby lowering offers made to you. It may lower the number and dollar amount of offers as the buyer compensates for the higher taxes generated by virtue of the higher assessment.
- Having the value lowered will hurt my neighbor’s property values.
FACT: If your value is too high then probably your neighbors are overvalued also, but only for tax purposes, as the market will determine the true value of your property.
HOW TO HAVE YOUR PROPERTY ASSESSMENT LOWERED
STEP 1 - Informal Appeal to the Assessor
First, you have a limited window to act. This step should be taken immediately upon determining your assessment for 2021 if you are not happy with the value set by the Assessor’s office. If you are satisfied, stop reading now.
Watch your assessor’s website and the mail. In Shelby County you will generally be notified in late March or early April of the value that has been set for your property for the current calendar year. You can also look online at the property assessor’s website for that value. The appeal process should begin by looking up the 2021 assessment at the Office of the County Tax Assessor ( https://www.assessormelvinburgess.com/propertySearch). You can look up your property by your name or the property address or Parcel Number. If you purchased the property after December 31, 2020, the property may not show up in your name on the tax records. Do not be concerned about this as the Assessor is not required to change their records after January 1.
Review the information on the Assessor’s site carefully for accuracy as to the number of rooms, number of baths, square footage and the like. If the information shown is not accurate you will need to notify the Assessor’s office for correction.
After you have determined your new appraisal amount, and assuming you are not pleased with the value, you can ask the Assessor’s office for an informal review (Go to: https://www.assessormelvinburgess.com/content?key=Appeals_Process). On this page look for the hypertext link to the informal appeal form for filing for an informal review of your valuation. This is an informal process and does not preserve your formal appeal rights however you may find that this is all you need to do to have your value adjusted. You will go back to the search page and again find your property. At the bottom of the list of options of items to view, you will see the following:
Just fill out the information requested on the linked page. You will be ask your opinion of value and the reason(s) for your appeal
You can attach up to two (2) files (electronic attachments) to the request. A more detailed explanation of the Assessor’s review process can be found here: (http://www.assessor.shelby.tn.us/Content.aspx?key=Appeals_Process). If you are not successful at this level, your next option is an appeal to the County Board of Equalization.
STEP 2 - The County Board of Equalization
This is a more formal process. The website for the Board of Equalization is located at: boe.shelbycountytn.gov. Please review this page carefully.
The formal appeal must be in writing to the Board of Equalization and should be on the form provided by the Board. You can file your appeal with the Board on line beginning May 1, 2021. The link to the online appeal site is https://boe.shelbycountytn.gov/eFile/. The form can be found can be requested by calling the Board’s office at 901-222-7300. They will mail you the form.
THE APPEAL MUST BE FILED BY JUNE 30 OF THE TAX YEAR
If it is not done by that time you will lose all rights of appeal for that tax year. The "EFILE" site is located at https://boe.shelbycountytn.gov/eFile/.
When appealing the value of your property and comparing it to other values of similar properties in the area, REMEMBER the Assessor and Board of equalization will only consider sales that were completed before January 1, 2021 in their review of value. Also remember that there is more than one (1) possible basis for appeal (see Tennessee Code Annotated section 67-5-1407 [http://www.lexisnexis.com/hottopics/tncode/]).
- The property is wrongfully classified.
- The value is too high and therefore unfair
- The value would be fair BUT similar properties are valued less, so your value is unfair.
When valuing your property, the assessor is to consider the manuals of the state board of equalization. The statutes state:
For determining the value of real property, such manuals shall provide for consideration of the following factors:
(2) Current use;
(3) Whether income bearing or non-income bearing;
(4) Zoning restrictions on use;
(5) Legal restrictions on use;
(6) Availability of water, electricity, gas, sewers, street lighting, and other municipal services;
(7) Inundated wetlands;
(8) Natural productivity of the soil, except that the value of growing crops shall not be added to the value of the land. As used in this subdivision (b)(8), "crops" includes trees; and
(9) All other factors and evidence of value generally recognized by appraisers as bearing on the sound, intrinsic and immediate economic value at the time of assessment.
After completing the appeal form and sending it in to the board there is little you can do until notified of the first hearing. This hearing will be before a hearing officer and you will be ask to appear to present your case for adjustment. While waiting for this hearing to be scheduled you should be gathering your evidence to present which will usually consist of data on comparable sales in the area. You may begin your search for by visiting the “Neighborhood Sales Search” section of the Assessor’s website: (http://www.assessor.shelby.tn.us/content.aspx?key=SalesSearch). You can also ask for help from your real estate professional in obtaining this data.
Should you need additional information, the Chandler Reports website provides some excellent information including their Tax Appeal Kits webpage where you can order comparable sales information.
When notified of the hearing you should plan for about an hour to 90 minutes, between waiting and the actual hearing. The “hearing” is very informal. The hearing officer will be a part time employee of the Board of Equalization and they generally have some familiarity with real estate and values. The hearing is not very formal and may be more like a discussion. Be organized in the hearing and you may furnish written materials (appraisals, spreadsheets of comparable sales, photographs, etc.) for the consideration of the hearing officer. One of the most important things to do at this hearing is to ask the hearing officer for a copy of any data furnished for his (her) consideration by the Assessor. This will generally be a list of the comparable sales that the Assessor’s office considers the most comparable to the value of your property.
After the hearing you will be notified by mail of the decision. If you are still not happy with the assigned value, the next level is to the full county Board of Equalization. Should the value be set lower than the Assessor believes it should be, then the Assessor may also appeal to the full Board.
THE FULL BOARD
If you request a hearing before the full Board, or the Assessor does, the hearing will be scheduled several weeks later. While waiting you can analyze the comparable sales which the Assessor is relying on as evidenced by the data you ask for at the initial hearing. When you attend the hearing before the full board you should take multiple copies of any data you desire to hand out (I suggest 10 copies). Both you and the Assessor will each be given about 5 minutes to present your case. It is critical to be well organized and to state your case succinctly. The Board will vote while you are there. There are not facilities for you to make a presentation by way of PowerPoint or the like.
Should you still not be satisfied with the results, there are further levels of appeal beyond the County Board of Equalization. To see a summary of the process see: https://www.assessormelvinburgess.com/content?key=Appeals_Process.
Sources of additional information
Chandler Reports http://chandlerreports.com/Site/Default.asp
Assessor Neighborhood Sales Search https://www.assessormelvinburgess.com/neighborhoodSales
BEST OF LUCK ON YOUR APPEAL