- Its property tax season in Texas. You should have received your Notice of Appraised Value by now.
- The deadline to file a protest is most likely May 15.
- Most property owners, therefore, should file a protest this week with their local appraisal district.
Well, if you are in Texas, you know it. I know it. We all know it. Its that time of year again. The deadline is upon us. It is property tax season. You should have received your notice of assessed value by now from the local appraisal district. And its time to get to fighting it.
I write a version of this article every year. But that’s because its such an important one. The deadline to protest your property taxes is a hard, unforgiving one. If you miss it, there is not a lot we can do. And in Texas, its really important to make sure you protest the property taxes for your commercial real estate. So lets talk about it.
Why Every Property Owner Should Protest Its Property Taxes
Property owners ask me a fair amount if they should protest their property taxes. And I always tell them the same thing – “There’s no reason not to.” And that advice is spot on. Every property owner should protest his or her or its property taxes every year. Because, at worst, you can just drop the protest and stick with the initial assessed value.*
On top of that, this year there is an especially good reason to protest. The commercial real estate market is in flux. It has loosened considerably since last year. Interest rates have increased significantly. And cap rates have followed. Yet, from what we have reviewed, it does not appear that the appraisal districts have taken notice. They have continued to increase the value of commercial real estate – sometimes in drastic amounts. As a result, if you own commercial real estate, you definitely should protest your taxes.
The Process for Protesting Property Taxes in Texas
As you probably know, in Texas, the local county appraisal district sets the appraised value of every property each year. The district sends property owners a notice of appraised value that indicates the estimated market value of their property. If the owner believes the assessed value is too high, they have the right to protest the appraisal. In doing so, the property owner should protest at least the market value and the equal and uniform value of the property.
To protest market value, the property owner must provide evidence that the appraisal district’s estimate is higher than the actual market value of the property. Evidence can include recent sales of comparable properties, income analysis, appraisals, or photographs of the property showing its condition.
To protest equal and uniform appraisal, the property owner must provide evidence that the appraisal district’s assessment is not uniform when compared to other properties. For example, if a property owner discovers that a neighboring property with similar features was appraised lower, he or she can use that information to argue for a lower assessment.
A property owner must file a protest with the appraisal district by the later of May 15 or 30 days after the Notice of Appraised Value is sent. That’s why this week is so important.
Once the protest is filed, the owner may be contacted by the appraisal district to discuss the protest and provide any additional information. If the owner and appraisal district cannot reach an agreement, a hearing will be scheduled before an appraisal review board. At the hearing, the owner will present their evidence and arguments for a lower assessment, and the appraisal district will present its evidence and arguments for a higher assessment.
At the end of the hearing, the appraisal review board will decide what the property’s value should be. The owner may appeal the decision to the district court if he or she disagrees with the appraisal review board’s determination.
It is important to note that property owners must continue to pay their taxes on time, regardless of whether a protest is filed. If the protest is successful, the owner will receive a refund of any overpayment.
In general, therefore, it usually makes a lot of sense for a property owner to protest the assessed value of his or her taxes. But to do so, the protest needs to be filed this week. So please do not delay – and if you need help, give us a call.