Introduction
Lowering property taxes can seem like a daunting task, but with the right approach, it is possible. Here’s a detailed account of how one property owner managed to reduce their property taxes on an investment property.
Initial Shock and Analysis
The property owner received their tax bill for a short-term rental property, noticing a significant increase in taxes since 2015. Initially, the tax amount was $2,069, but by 2022, it had risen to $4,500, an average annual increase of 12%.
Understanding the Tax Cap
In their location, investment property taxes could increase by up to 10% annually, while residential properties with a Homestead exemption could only increase by 3% annually. This difference significantly impacts the cost of owning an investment property over time.
Comparing with Other Properties
To challenge the assessment, the owner began by comparing their property taxes with those of neighboring properties. This involved extensive research, considering various exemptions and property histories, making it challenging to find a direct comparison.
Seeking Professional Help
The owner explored several options:
- Hiring a property appraiser to get an independent assessment.
- Filing a formal petition with the city.
- Directly contacting the city’s property appraiser.
Contacting the Property Appraiser
Choosing the third option, the owner contacted the property appraiser’s office in Tampa, Florida. They were advised to find comparable properties to support their case.
Utilizing Online Tools
Using Zillow, the owner searched for properties sold in the last 12 months within a similar price range. This provided a list of comparable properties, which were then further investigated on the city’s property appraiser website.
Reassessing the Property Value
The property owner’s research revealed that the assessed value of their property was higher than comparable properties. They presented this evidence to the property appraiser, who reassessed the property value, resulting in a new assessment of $236,708.
Calculating the Savings
After the reassessment, the new property tax amount was $4,176.37, down from the previous $4,516, saving $340.15 annually. This reassessment not only reduced the current year’s taxes but also set a lower base for future tax calculations, adhering to the 10% cap rule.
Learning from Mistakes
The owner reflected on a past mistake of transferring the property to an LLC in 2015, which triggered a reassessment and a 13.34% tax increase. They emphasized the importance of questioning assessments promptly to avoid compounding tax increases over time.
Conclusion
This experience highlights the importance of questioning property tax assessments and utilizing available resources to ensure accurate valuations. By actively engaging with the property appraiser’s office and conducting thorough research, significant savings can be achieved, providing financial relief for property owners.
Final Thoughts
For those facing high property taxes, this case demonstrates that it is possible to lower them by understanding the process, gathering evidence, and persistently advocating for a fair assessment.
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