The Milwaukee Journal Sentinel writes today about the sticker shock property owners are having when they open their property tax bills. The taxes have gone up in general, but property owners are frosted because their assessments no longer match the real market value of their houses.
The reality is that property values are generally down, and municipalities that use some variation of “market value” for their assessments are treading on thin ice.
The newspaper reports on a property owner whose assessment went from $140,500 to $173,100. The tax bill went up 27%, or $871. The homeowner says he couldn’t sell his house for $173,100 even if he wanted to.
Last week I was on CNBC’s personal finance show On The Money talking about this issue. I successfully fought my assessment last year, and encourage other homeowners to do the same.
I encourage homeowners to challenge their assessments if they can prove that they are out of line with market values. Local governments are going to have trouble, though, if property owners object in large numbers. The government still wants the same amount of money, so they’ll have to do a large rate increase to keep the cash flowing their way. This would mean that even if you are successful at having your assessment reduced, you might still pay the same amount of property taxes.
And in other “breaking” news: More than a month after a database of Milwaukee Public Schools spending was made public, the Milwaukee Journal Sentinel is finally reporting it. Why would the Journal Sentinel neglect to make a timely report of an issue so critical to taxpayers?
Here’s an interesting tidbit from the article: “MPS spokeswoman Roseann St. Aubin said MPS officials believe they have adequate controls over spending and they monitor bills to see that they are appropriate.”
I disagree. MPS doe note have adequate controls over spending. The district keeps contending that it has been cut to the bone and there are simply no areas in which to reduce spending. This database proves the exact opposite. When are taxpayers going to demand that MPS quit wasting their money?
The same is true here in the Southwest. My property taxes (as an example) went through the roof at the same time the house’s value dropped a hundred grand.
The problem is, the county tax assessor sends you a statement of the property’s assessed value some months before the tax bills go out. The assessed value has exactly zero relationship to the actual value of the house–never has borne any relation to reality. Consequently, it’s impossible to know whether the figure you’re looking at on this piece of paper is correct or fair, nor can you know what effect the make-believe figure will have on your taxes.
You only have about three weeks in which to protest the valuation. After that, you lose the opportunity to complain. Most people who do protest lose, anyway.
Not until three or four months later do you get the tax bill and realized that your bill was based on a nonexistent increase in value. By the time the tax statement arrives, it’s way, way too late to protest.
You don’t really even know what you’re being charged for. To get an itemized statement, you have to navigate the bureaucracy to make a special request. People in my neighborhood have learned, for example, that they were charged for nonexistent swimming pools and for more water outlets than existed (yes–part of your taxation is based on how many spigots your house has!). When a taxpayer learns about overcharges, the county will quit gouging from that point forward, but as for all the years of overpayment…well, that’s just tough. You do not get a refund for overpaid property taxes.
LOL! Goes a long way toward explaining some folks’ attitude toward the tax system, doesn’t it?