Did you know that you need not pay more than your fair share of property taxes according to a government mandate? However, if you overpay, it is your fault, and not the government. That’s why you should discuss your tax requirements with a property tax consultant before filing.
If you wish to save on taxes, it is advisable to be proactive and not wait for the notice to be served by the authorities. The longer you wait, the more the chances for errors and declines to pile up, complicating matters further. It’s not in the tax assessor’s interests to worry about lowering your tax liabilities; hence it makes sense to stay ahead in your tax matters.
How to Save Money on Property Taxes?
Property taxes can always be negotiated, and you don’t have to pay whatever appears in the notice. However, only an experienced consultant has the time and expertise to challenge tax assessments and lead to significant savings by lowering your tax liability.
Most people realize the merits of outsourcing property tax management to an experienced property tax consultant with the wherewithal to guarantee favorable results.
Here are some ways to save on property taxes:
Calculate your Annual Property Tax Outgo
If you own many properties, you may not know off-hand how much you pay in property taxes each year. Regardless of the amount, it would help if you had this figure in mind while negotiating reductions via your property tax appeals.
Instead of going for an appeals process, which is time-consuming and expensive, it is advisable to leave it to your tax consultant, who will help save a lot of money through informal negotiation.
Some Tax Bills Earn Discounts
Certain jurisdictions offer incentives when people come forward voluntarily to make payments much before they are due. Some counties in Florida offer discounts ranging from 1 to 4 percent for early payments.
The trick lies in identifying the jurisdictions that offer discounts and taking advantage. Here’s where an experienced property tax consultant can help as they have such information at their fingertips.
Paying in Installments Cost More
Another simple way to save on property tax is to not avail of the provision several jurisdictions have that allow you to pay property taxes in installments. While settling in installments can be convenient, it comes with a cost that you may not realize. Staggering property tax payments have a catch as you are charged extra. Hence, why not take advantage of the incentive offered if you pay your property tax dues in one shot?
How Can You Use the Appeals Process to Your Advantage
Tax jurisdictions have their requirements and rules when it comes to property tax appeals. Sometimes, you can use such appeals in your favor. For instance, some jurisdictions allow you to pay 85 percent of the tax dues while the property is still under appeal.
If the appeal goes in your favor, you don’t have to wait for a refund. However, if you lose your appeal, you need to pay only the remaining 15 percent. Moreover, the due amount is available for investing in your business (for a short time) and may earn some quick profits.
Discuss with Your Local Assessor
It pays to get to know a local property tax assessor, and if you get a chance to talk to them, make sure you do your homework thoroughly. Know enough about your property and have the information at your fingertips.
Small bits of information like the square footage of the property, the current assessment of properties in this jurisdiction, the purchase date, and prices prevailing at that time will all come in handy while talking with your property tax assessor.
Some points to brush up on before meeting your property tax assessor:
- Research the prices of similar property in the neighborhood that was sold recently.
- The average rental revenue from such properties in the jurisdiction.
- The breakup of costs to maintain the building annually (including fixed and variable costs)
- The occupancy rate and the approximate revenue the property generates.
Of course, you may not have the time at your disposal to do all the groundwork. That’s when a property tax consultant’s services come in handy as they handle such cases day in and day out.
Summing it Up
Your tax consultant will help you familiarize yourself with the appeal process. They will keep you informed of the filing deadlines, which are not the same for all states or counties. You have as little time as 15 days from the receipt of assessment to pay your tax dues in some jurisdictions. An important point to keep in mind is that you forfeit the right to appeal if you fail to pay property tax.