Challenging Your Real Estate Tax Assessment

posted by Ronald Kowalski January 16, 2015

Cities and towns in Connecticut must conduct a general revaluation of each parcel of real estate within its borders once every five years, pursuant to a schedule promulgated by the State. Municipalities conduct revaluations on a rotating basis around the state, with different cities and towns reevaluating their each year. During the revaluation process property owners will receive notice of their property’s new tax assessment. Although there are ordinarily opportunities to discuss a new assessment informally with the revaluation company, the formal property tax appeal process is dictated by statute, and requires that a property owner who wishes to contest an assessment file an appeal with the local Board of Assessment Appeals by February 20 when the revaluation is being performed. If the owner is dissatisfied with the results of that administrative appeal, an appeal to Court must be filed within two months of the Board’s decision or the right to appeal will be lost.  Although an appeal may be filed in any year, the financial benefit to be gained is greatest when an appeal is pursued immediately after a revaluation.

All things being equal, a revaluation will not, in and of itself, result in an overall increase in taxes, though it will often result in a shift in the tax burden between categories of property. For example, the current revaluation in Hartford will reportedly result in residential property owners bearing a larger share of the tax burden than they had previously due to the weak commercial real estate market. Consequently, owners of homes, apartment buildings and similar properties are likely to see tax increases, where owners of office buildings and other commercial properties are likely to enjoy tax reductions.

When considering whether to challenge a property tax assessment, the critical question is the property’s true fair market value as of the October 1 revaluation date, not the corresponding amount of taxes to be paid on the assessment. Therefore, even if the taxes on a property decrease after a revaluation, it is essential that a property owner still evaluates the viability and potential monetary benefit which may result from a tax appeal. For example, if a revaluation results in a property’s assessment declining by $5 million and the corresponding taxes being less than the previous year, the property owner may be happy enough to leave things as they are. However, if the municipality’s assessment should have declined by $10 million instead of $5 million, the property owner will still be paying far more than his or her fair share in taxes over the 5-year revaluation cycle if the assessment is not successfully challenged.

The decision as to whether to pursue a tax appeal is best made after consultation between the property owner and experienced legal counsel, during which all matters related to the property’s value as of the October 1 revaluation date, and appropriate legal and valuation grounds, are considered. A thoughtful, critical analysis of whether an appeal is warranted in the first instance will usually result in a financial benefit to the property owner, whether an appeal is ultimately pursued or not.

If you have a question about the revaluation process in your city or town, or about how to appeal the revaluation of your property, call one of our experienced valuation attorneys.

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