property tax appeal - why are my taxes so high?

Property Tax Valuation Appeals in Ohio

Reducing your property tax bill

Presenter: Paul T. Saba, Esq.sspfirm.com 1

Full Service Law Firm◦ Wills, Trusts, Estate Planning & Administration◦ Real Estate◦ Corporate◦ General Litigation

Business Disputes Personal Injury And Medical Malpractice Labor And Employment Law

◦ Real Estate Tax Valuation Appeals

Stagnaro, Saba & Paterson

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This presentation is offered for informational use only. Nothing in this presentation constitutes legal advice, and an attorney-client relationship with either the presenter or Stagnaro, Saba & Patterson, Co. L.P.A. is not created with any member of the audience based solely upon this presentation.

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Disclaimer

Why Are My Taxes So High?

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Your house as seen by…

Yourself Your Buyer

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Your house as seen by…

Your Lender Your Appraiser

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And your county’s tax assessor…

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Assessed value ◦ Auditor’s valuation of property◦ Listed on tax bill

Fair market value◦ Selling price on open market

If assessed value = fair market valueSTOP - DO NOT APPEAL

Should I Appeal?

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Hamilton County Property Tax History

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Historical Effective Rate(Residential/Agricultural)

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Hamilton County Property Tax Projection

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Comparison: Surrounding Counties

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Comparison: Major Ohio Counties

How Are Taxes Calculated?

Components of a Hamilton County Tax Bill

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VALUATION x RATE

– ROLLBACKSTAX

Broad Calculation of Tax Bill

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Prototype Tax Bill:2623 Erie Avenue

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Prototype Tax Bill

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Prototype Tax Bill

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Current Hamilton County Mills

Distribution

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65.06%

13.81%

School DistrictTownshipCity/VillageJoint Vocational SchoolCounty General FundPublic LibraryFamily Service/TreatmentHLTH/Hospital Care-IndigentMental Health LevyDevelopmental DisabilitiesPark DistrictCrime Information CenterChildren ServicesSenior ServicesZoological Park

Valuation:The Variable You Can Influence

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1,300 different appraisal districts 350,000 separate parcels 117 tax districts

The Assessment Challenge

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Reduction results in proportionate tax reduction◦ $10,000 reduction ≈ $200 in ANNUAL tax savings

Savings last AT LEAST through end of triennial◦ Hamilton, Clermont and Butler Counties

2017 is first year of the triennial 2016 savings will last 1 year

◦ Warren County 2015 was the first year of triennial 2016 savings will last at least 2 years

What Valuation Reduction Means

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Complaint Form & Filing

Critically Important Dates

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Tax lien date: 1/1/2016◦ Effective date of valuation challenged in 2017◦ Evidence MUST prove value AS OF THAT DATE

Not when tax bill received Not on date of hearing

◦ Many cases dismissed because this issue is missed

Filing deadline: 3/31/2017

Critically Important Dates

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The 35% Issue

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What your property is worth◦ “True value”◦ “Full value”◦ “Market value”◦ “Fair market Value”

35% of fair market value◦ “Assessed value”◦ “Taxable value”

Note Again 1/1/2016 Tax Lien Date

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The 35% Issue


Review of Complaint Form

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What Not To Do

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Presentation of CaseEvidence of Value

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Only issue: property value as of tax lien date◦ January 1, 2016

Auditor required to determine “true value” of parcel◦ ORC § 5713.03◦ If tract is subject of recent arm’s length sale, auditor may

accept this as “true value” Unless loss due to casualty; or Unless improvement added

Presentation at the Board of Revision

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Auditor’s value presumed accurate◦ Property owner must establish right to reduction ◦ Auditor & school board have no duty to introduce evidence

Have duty to respond if property owner has met burden of proof◦ Board does not have to accept property owner’s evidence

ORC § 5715.19(G)◦ A complainant who fails to provide such information or evidence

is precluded from introducing it on appeal to the board of tax appeals or the court of common pleas, except that the board of tax appeals or court may admit and consider the evidence if the complainant shows good cause for the complainant's failure to provide the information or evidence to the board of revision.

Property Owner Has Burden of Proof

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“My property value did not increase 25% in 1 year”

Listings are of little value

Auditor’s valuations of other properties of NO use

Actual sales or construction data of subject property

Comparable sales are the best evidence

Presentation at the Board of Revision

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Definitions

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"Real property," "realty," and "land" include land itself, whether laid out in town lots or otherwise, all growing crops, including deciduous and evergreen trees, plants, and shrubs, with all things contained therein, and, unless otherwise specified in this section or section 5701.03 of the Revised Code, all buildings, structures, improvements, and fixtures of whatever kind on the land, and all rights and privileges belonging or appertaining thereto. "Real property" does not include a manufactured home as defined in division (C)(4) of section 3781.06 of the Revised Code or a mobile home, travel trailer, or park trailer, each as defined in section 4501.01 of the Revised Code, that is not a manufactured or mobile home building as defined in division (B)(2) of this section.

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Real Property

"Business fixture" means an item of tangible personal property that has become permanently attached or affixed to the land or to a building, structure, or improvement, and that primarily benefits the business conducted by the occupant on the premises and not the realty. "Business fixture" includes, but is not limited to, machinery, equipment, signs, storage bins and tanks, whether above or below ground, and broadcasting, transportation, transmission, and distribution systems, whether above or below ground. "Business fixture" also means those portions of buildings, structures, and improvements that are specially designed, constructed, and used for the business conducted in the building, structure, or improvement, including, but not limited to, foundations and supports for machinery and equipment. "Business fixture" does not include fixtures that are common to buildings, including, but not limited to, heating, ventilation, and air conditioning systems primarily used to control the environment for people or animals, tanks, towers, and lines for potable water or water for fire control, electrical and communication lines, and other fixtures that primarily benefit the realty and not the business conducted by the occupant on the premises.

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Business Fixture

Expert may present valuation issues◦ Realtor◦ Appraiser◦ Environmental Specialist

Owner always qualified to render opinion

Who May Testify?

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Three valuation techniques

◦ Comparable sales approach

◦ Replacement value approach

◦ Income approach

Evidence Presented At Hearing

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Comparable Sales (not listings)◦ Best comps are within 6 months of tax lien date◦ Close: same or surrounding neighborhood◦ Size: similar house and lot size◦ Age: similar age of construction◦ Bedrooms & Bathrooms◦ Total square footage◦ Number of garages◦ Interior finish and recent renovation ◦ Amenities (finished basement, pool, etc.)

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Valuation Information to Present

Risks to Complainant

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Auditor can go back to correct errors◦ 5 years or until conveyance (whichever is shorter)◦ Omitted tax◦ ORC § 5713.20

Board of Revision can increase valuation◦ Note frequent school board counter-complaints◦ Expect same on commercial properties

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Risks to Complainant

Presentation of CaseProcedural Issues

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Representatives of Auditor, Commissioners and Treasurer◦ Note conflict: Auditor as original assessor,

“prosecutor,” and judge

In outlying counties, these elected officials frequently serve in person

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Composition of Board

Only complaints regarding valuation within jurisdiction

Auditor values set in September◦ After tax levies from that year are certified

Deadline March 31 for preceding tax year

Only one complaint per triennial

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Procedural Issues

Property sold in arm’s length transaction◦ ORC § 5715.19(A)(2)

Material change in property◦ ORC § 5715.19(A)(2) ◦ Casualty, Improvement, Loss of major tenant

Unauthorized practice of law◦ ORC § 5715.19(A)(3)

Prior complaint withdrawn before hearing◦ ORC § 5715.19(A)(4)

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Exceptions

Accelerates filing to before tax due date

If prevail, no penalties

If lose, interest applies ◦ If bill increases, penalty will also apply

Danger of tender pay on multiple parcels◦ Win can still result in penalties and interest

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Tender Pay at Filing

Presentation of CaseAppeal Procedures

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Forum◦ Common Pleas Court (where property located); or◦ Board of Tax Appeals

Deadline◦ 30 days after mailing of BOR decisions

File with BOR and appellate jurisdiction

Further appeal to Ohio Supreme Court

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Appealing the Decision

Other Statutory Savings

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Current Agricultural Use Valuation (CAUV)◦ ORC § 5713.31◦ Note: partial recoupment on sale

Forestry◦ ORC § 5713.23◦ Application with Ohio Dept of Natural Resources◦ Physical inspection by ODNR◦ If devoted exclusively to forestry or timber, tax

rate is ½ of typical rate

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CAUV and Forestry

Benefit◦ $25,000 of home’s market value exempt from taxation◦ Approximately $500 per year in tax reduction

Eligibility (for new applicants starting in 2015)◦ 65 or older OR totally and permanently disabled◦ Own and occupy home (up to 1 acre) as of January 1,

2015◦ Total adjusted gross income of household ≤ $31,800 for

2017

Property held in trust is an issue

Homestead Exemption

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Other programs available◦ Usually require construction/improvement

Residential tax abatement

Commercial tax abatement

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Tax Abatement Programs

Hamilton County Auditor

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Property Search Walkthrough55

HamiltonCountyAuditor.org

Comparable Sales Search65


Thank you for coming. Let us know if you would like assistance

with filing. Go save some money!

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