3 Reasons to Fight Your Property Tax Bill

Here's why it pays to appeal your property taxes.

When you buy a home, it's not just your mortgage that you're required to keep up with. You'll also be on the hook for property taxes, which can be even harder to work into your budget.

If you sign a fixed mortgage, your monthly payments will stay the same throughout the life of your loan unless you refinance. Property taxes, however, can rise and fall, making them less predictable.

If your property taxes have risen recently, it could pay to file an appeal. Here's why.

1. You can lower your property taxes up front

Your property tax bill is calculated by taking your home's assessed value and multiplying it by your local tax rate. The latter is determined by your town or city and is set in stone. When you file a property tax appeal, what you're really doing is arguing that your home is being assessed at a higher value than it's actually worth.

If you appeal your property taxes and win, it could result in a lower bill until your property’s next assessment. Some towns assess properties every year, but others only do assessments every few years, so the lower tax bill you secure could stay in place for a while.

2. You can potentially prevent a future property tax hike

Sometimes, tax assessors raise property assessments simply because they can. But if you make a point of fighting a higher property tax bill, your local tax assessor may not be so quick to raise your assessment the next time that process takes place.

When you appeal a property tax bill, it often means taking your local assessor to court. That's a hassle your assessor may not want to deal with. If you fight your property taxes one year, it could cause your tax assessor to leave you alone for a few more years.

3. You can help your neighbors lower their property taxes

The more you're able to lower your home's assessed value, the more you might manage to help your neighbors out with their property taxes. Arguing an assessment down is easier when there are more lower-valued homes nearby. If you manage to knock your home's assessment down from $350,000 to $320,000, your neighbors will have an easier time claiming their homes are worth less, too.

Remember, if you're selling a home, you want to argue that your home is worth more. But from a property tax perspective, having a lower home value works to your benefit.

How to fight your property taxes

The process of appealing property taxes differs based on where you live. In some cases, it simply means filling out a form and submitting it online or mailing it in. In other cases, it means facing off against your local assessor in court (this is something you generally do not need a lawyer for, though). There are also fees to appeal a property tax bill that differ by area and home value.

If you're looking at a modest tax hike, appealing your property taxes may not be worth the hassle (such as if your home was previously assessed at $320,000 and is now being assessed at $323,000). But for a larger increase, fighting back could be more than worth your time for multiple reasons.