Articles from 2011
You have filed for an Abatement Application with the local assessor in a City or Town in Rhode Island, much to your dismay your appeal has either been denied or ignored. You then file your appeal with the local Tax Board of Review who after a hearing denies your appeal. What can you do? You can file a petition in the Superior Court in the county where the property is located. There the Petitioner will be afforded a jury trial if one is requested or a bench trial before a Superior Court Judge with a life time appointment. Either way the arbiter of fact is not a city employee or a political appointee who must be reappointment in the future in order to keep his or her job. Property tax appeals to the Superior Court can be laborious and expensive but the finder of fact is likely to be independent.
One of the ways in which Massachusetts is unique is that for most real estate tax appeals you must pay your taxes on time in order to effectuate a valid appeal. This means that the tax payment must be in the hands of the local Collector of Taxes by the due date. This is true even if the taxpayer does not receive the tax bill. It is presumed that the taxpayer knows when the taxes are due! The Appellate Tax Board on its own motion reviews the property tax payments to verify that they have been paid timely. In most cases, if the taxes are not paid timely the taxpayer will not be afforded a hearing at the Appellate Tax Board. If the taxes cannot be paid, or if a late tax payment is discovered, consult with an attorney as there are some very limited exceptions to this odd and draconian rule.
Most jurisdictions in New Hampshire will be sending out their tax year 2011 property tax bills in October or November of 2011. That tax bill has an assessing date of April 1, 2011. The tax bill should reflect the market value of the subject property multiplied by the median assessment ratio. In most cases if the taxpayer is aggrieved he may file an Abatement Application with the local assessors on or before March 1, 2012. If the taxpayer is denied in most cases he may then file a petition with The State Board of Tax and Land Appeals or the Superior Court no later than September 1, 2012. In most cases if the assessor fails to act on the Abatement Application by July 1, 2012, the taxpayer may then file with the Board of Tax and Land Appeals or in the Superior Court no later than September 1, 2012.
In New Hampshire there is a peculiar rule that is when appealing your property tax assessment you must consider the assessments of all your other property within the jurisdiction. For example if one property you own and pay taxes on is over assessed by a certain amount and the assessment of the other property you own and pay taxes on is under assessed by the same amount there is no abatement. The two assessments, the one that is too high and the other that is too low cancel each other out. It is still possible to prove a case where multiple properties are owned but you must prove value on all the properties in the jurisdiction. This can make the task at hand significantly more difficult than at first anticipated. It is easy to see how this unusual rule can prove to be an unpleasant surprise to the unwary.
In Massachusetts the fiscal year 2012 commences on July 1, 2011 and ends June 30, 2012. Most cities and towns will be sending out their actual fiscal year 2012 property tax bills in December of 2011. The assessed value on this tax bill purportedly reflects the fair market value of the property as of January 1, 2011. The 351 cities and towns in Massachusetts have been under a mandate to revalue their communities every three years. In recent years exceptions to this triennial requirement have been allowed. The reason for these exceptions is in part that a disproportionate amount of cities and towns were scheduled to revalue in certain years. This caused the State Department of Revenue to have a disproportionate amount of communities to review and certify as being properly revalued in some years and relatively few in others. The staggering of revaluation dates helps to keep the process of regular revaluations more manageable.
In Rhode Island many taxpayers are in the midst of the appeal process for Tax Year 2010. Some taxpayers have received or will receive a decision from the local Board of Tax Review. The taxpayer has 30 days from the decision of the local Board of Tax Review to appeal to the Superior Court. In Rhode Island cities and towns must conduct a comprehensive property revaluation every nine years and conduct an update every three years between full revaluations. These requirement periods are staggered so the time table is different for each jurisdiction. In order to prove that real estate is overvalued the taxpayer must prove that the assessed value is more than the fair market value as of December 31st in the year of the last update or revaluation. In other words the taxpayer must prove fair market value in the base year which may be a previous tax year.
The New Hampshire Department of Revenue will be publishing its Tax Year 2010 ratio list within the next few months. This ratio list is very important as it reports the mean and median assessment ratios of each community in New Hampshire as of April 1, 2010 which is the assessing date for Tax Year 2010. The filing deadline for Tax Year 2010 Abatement Applications was generally March 1, 2011. Applicants cannot be fully aware of the merits of their Application until they know the assessment ratio. To a certain extent applicants are operating in the dark until the ratio lists are published. In New Hampshire the market value of real estate must be multiplied by the assessment ratio in order to arrive at a proper assessed value. Due to a generally decline in real estate values increasingly the assessment ratios are exceeding 100%. Thus the proper assessed value can be in excess of market value.
In Massachusetts many communities have sent out or will send out Requests for Information pursuant to M.G.L. Chapter 59 Section 38D. These requests usually ask for income, expenses and rent rolls for commercial and industrial properties. These requests are purportedly to assist the assessor in establishing the upcoming Fiscal Year 2012 property tax assessments. The assessor will typically request calendar year 2010 income and expenses and rent rolls as of January 1, 2011. The Fiscal Year 2012 has an assessing or valuation date of January 1, 2011. The failure to respond to these Requests for Information in most cases will bar the taxpayer’s right to appeal the future Fiscal Year 2012 assessment. In addition, the penalty for failing to respond to the Requests for Information has recently been raised from $50.00 to $250.00. The failure to respond to these requests can prove to be a trap for the unwary taxpayer.
Most communities in Rhode Island will be sending out their tax year 2011 tax bills this summer. A person aggrieved by the assessment may file within ninety days from the date the first tax payment is due an appeal in the local office of the tax assessor. The assessor has forty-five days to render a decision. If the assessor renders a decision and the applicant is still aggrieved or if the assessor fails to render a decision within the forty-five day period the applicant may appeal the decision or lack thereof to the local Tax Board of Review. In an appeal where the valuation of real property is the issue, the applicant must prove that the assessment is in excess of the market value of the property as of December 31st of the year the property was revalued. The year that the properties are revalued is commonly referred as the base tax year.