Did you know that 30-60% of taxable property is over-assessed, and less than 30% of all taxpayers challenge their tax assessment? Protesting your Central Texas property tax is a great way to help keep your property tax low each year as Texas has one of the nation’s highest property tax rate (take that, California!). If you own property in Central Texas, this is important for you. You should make it a yearly effort to protest your property value taxes because engaging in property tax protest could save you several hundred to several thousand dollars over time.
Pro tip: You won’t be notified unless your appraisal value has gone up by more than $1,000, so it is a good habit to protest every year to help combat any increase.
Why Is Tax-Assessed Value Different Than Market Value?
Texas is a non-disclosure state. The county is not supposed to have market data to use to assess your home. So instead, the tax-assessed value is what your county believes your property is worth. The county attempts to set its values at a market value, however; they do not evaluate comparables and they don’t perform an individual market analysis on every home. The county simply values your home according to the area, not the house. Meaning the value may be too high or too low, depending on the size, location, amenities, and condition of your specific home.
How Do You Determine Your Market Value to Protest Property Taxes?
You can determine your home’s market by unlocking home sale prices by registering on RealtyAustin.com and assessing comparables in your neighborhood. You can also use our Property Valuation Tool to determine a rough estimate of your home’s market value. Contact me if you need help understanding market information, collecting information from neighbors who have recently purchased their homes, or contracting a company that specializes in assisting with tax assessor valuation protests.
Should You Appeal Your Property Valuation?
If the market value on your home is lower than your tax assessed value, then you should appeal. If the market value is higher, then you should not appeal. Chances are that the value will go up every year!
When Should You Receive Your Property Valuation and How Long Do You Have to Appeal?
The state is required to inform you if the appraisal district values your home higher than the previous year. You should receive that notice by May 1st, or by April 1st if your property is a residence homestead. The deadline to file your protest is May 15th.
How to Protest Property Taxes
If you believe your property valuation is higher than the current market value, you should appeal your taxes. When people don’t appeal, the taxing authority accepts that their value is correct which affects all homeowners in a given area. By appealing the assessed value, we all help keep our real estate taxing authority valuations in line with market value. Some companies can do this for you for a fee (which I actually recommend), but it isn’t too complicated to do yourself.
File your protest using the protest form (Form 50-132 Notice of Protest PDF) available from the County Appraisal District. You can also file online to protest your Travis County property tax.
After you have filed, it can take several months for the Travis County Appraisal District to schedule your informal hearing.
At the hearing: The purpose of the informal hearing is for you to present your evidence and facts to support your claim that they have overvalued your Austin home or condo.
Present Your Evidence
The following information can be helpful to present at the hearing:
- Comparable Market Analysis: A comparable market analysis looks at Market Value and shows recent sales for homes that are similar to yours in size, age, location, and type of construction. Use our website to unlock home sale prices and find comparables in your neighborhood.
- Documentation Regarding Your Home’s Condition: Do you have foundation issues? Plumbing problems? Anything that would adversely affect the Market Value of your home should be documented. Take photographs and bring them with you to your hearing.
- Documentation Regarding Your Home’s Location: Once again, anything that would adversely affect the Market Value of your home is evidence that you can use in your appeal. (ie: if the home backs up to a busy street – consider printing off a Google map to document your location.)
- Recently Purchased Homes: If you purchased your home in the last several months, and the purchase price was lower than your appraised value, bring a copy of your settlement statement.
Things to Keep in Mind for the Day of Your Hearing
The Appraisal District is responsible for setting the appraised value, they have nothing to do with the tax rate.
You are not going to the hearing to protest your tax rate or how much you are paying in taxes, you are only appealing the county’s assessed value of your home.
- Be polite and courteous.
- Bring an extra copy of your supporting documentation to leave with the county.
- If you don’t like the results, you can request a formal hearing that is more like a court case.
Property Tax FAQ
We understand that this information can seem overwhelming, and you may have a lot of questions about protesting your property taxes. Here are some Q&As, with information from the Texas Comptroller, designed to help you gain insight into the process:
Q: If the person selling a home files a protest, then sells, does the buyer have the ability to complete it?
A: No, the buyer would have to file the protest on their own.
Q: What is the market value?
A: What the property would sell for.
Q: What is the assessed value?
A: The limited property value after exemptions are applied.
Q: What is the taxable value?
A: The property value you pay taxes on.
Q: What is an ARB?
A: An ARB (Appraisal Review Board) is a group of citizens authorized to resolve disputes between taxpayers and the appraisal district.
Q: Do I need to protest in person?
A: According to the Texas Comptroller, you or your professional service agent may appear in person, offer evidence or argument by affidavit without appearing in person, or you may appear by telephone conference call to offer argument and offer evidence by affidavit.
Q: If I fight my value, can the county increase the amount they set for my property value?
A: No, fighting your value will not hurt you and they can’t increase your value.
Q: How many people fight their value each year?
A: Less than 30% of Texans fight their value.
Q: Why fight my value if I have a homestead cap?
A: Let’s say last year the value was $500K, and this year the appraised value came in at $900K. You have the homestead cap so the taxable value is only $550K for this year. If you do not fight the $900K and get it down, you now have given the county 5 years where they can go up 10% a year, even if values in the following years are not as high.
Still Have Property Tax Questions?
You can watch Travis County webinars about the process to better understand the nuances and to hear from local experts. Also, you can refer to the appraisal district website that you are filing your protest in, like Hays County, Travis County, Williamson County, or Bastrop County.
Disclaimer: The information provided in this blog does not constitute legal advice. If you are unsure at any point, it is best to work with a professional. Some options are Home Tax Shield, Five Stone Tax Advisors, and Texas Pro Tax.
Thanks so much to my team at Realty Austin Compass for doing much of the leg work for this article!