Thanks to rising values and taxes across the state, Texans are using property tax appeals at a pace never seen before in the state. Even with extensive overhauls to homestead, over-65, and disabled persons’ exemptions, the pressure remains on every homeowner and business to bring costs under control. For homeowners, property taxes are one of the highest recurring costs in Texas, and appeals can work alongside exemptions to further reduce your tax burden. With the influx of new protesters this year, many are wondering what happens after an appeal is filed.
The first step on the protest ladder is the informal hearing. This meeting with an appraisal district representative is an important first step to tax reduction, and is often the only step a taxpayer needs. In this article, we will go over what you need to do to get ready for this meeting and how to maximize your savings.
What is an Informal Hearing?
An informal hearing is a meeting between a taxpayer and a representative of the appraisal district. In this meeting, the taxpayer will discuss their property and appraisal with the representative, in hopes of getting a correction or a reduction. This is dependent on the evidence that the taxpayer brings. Some appraisal districts are quite open to informal appeals and will offer settlements easily. Others are much stingier when it comes to reductions and settlements. This makes being prepared paramount to achieving a reduction in any informal appeal. This simple hearing also acts as a gateway to more organized forms of protest, including formal hearings and litigation.
Decide on the Grounds of Your Argument
In Texas, there are three types of grounds that can be used to argue a case. First, there are informational errors, such as missing exemptions, the wrong square footage, an incorrect owner’s name, overvaluation of market value, or other basic errors. Then there is unequal appraisal, where your home or business is assessed above that of neighbors with similar properties. Finally, there is excessive assessment or appraisal, which is when your property is appraised beyond its realistic sale value. By choosing a ground, you can tailor your evidence and your argument to best fit what you are trying to accomplish.
Review Your Evidence
The core of every appeal is evidence. Since informal appeals are handled directly with the appraisal district itself, you will need to stack the deck in your favor as much as possible. This is where building and organizing evidence comes in. The more you have on your side, the better chance you have of achieving a favorable outcome. By choosing your grounds, you know what to build toward. If the main issue is a factual one, then you need to be able to prove this. For instance, if your home is listed as larger than it actually is, you may need an independent survey or inspection to prove the true size. If there is an issue with nonexistent improvements, then photography can also be a benefit.
When challenging overassessment, this will take a lot more effort. The condition of the property will need to be documented with photographs, repair estimates, and other documentation pointing to deferred maintenance should also be gathered. The most important documentation to collect is sales records in your neighborhood. These should be from properties that share as many characteristics of yours as possible, including age of construction, size, number of rooms, and location. The more comparable sales you can find, the better.
If you wish to prove unequal appraisal, you will need to have gathered several appraisals from around your general area. These appraisals will need to follow the same rules as the sales comparables. It is best to also photograph these properties, so that conditions and improvements can be documented and then compared to yours. It is usually best to have around five comparables.
Be Informative and Civil
When meeting with the appraisal district representative, it is imperative to act politely. This is not a place for confrontation, and this meeting is meant to iron out any errors, issues, or irregularities. The evidence should do all of the talking for you, so you will simply need to state the facts. By having a goal in the grounds you selected, and by backing it up with data, you are in the best position to get a reduction. Unlike the ARB, the informal meeting should be quick and straightforward.
The Settlement Offer
If your evidence is satisfactory and the appraisal district is willing to deal, then you may be offered an informal settlement. This is a reduction in your taxable value, which would then lead to lower taxes. When you receive the settlement offer, review it and see if it meets your expectations or needs. Most property tax appeals are settled at this level, and it is possible that all of your goals could be met after this one meeting. However, if you take the settlement, then your appeal journey ends. If you wish to get a better reduction, or your informal meeting ended without a settlement, then the next option is to move on to a formal hearing with the ARB.
Going to the ARB
The second stage in the tax protest journey is a formal hearing. This is done with the county’s ARB, which is an impartial trio of real estate experts that will judge the case based on your evidence versus the evidence of the appraisal district. While the ARB is beyond the scope of this article, we have covered it before. ARB hearings are much more rigid, and the evidence brought to the table must be refined and organized in a much more comprehensive manner. Unlike informal meetings, formal hearings typically take much longer, usually around 30 minutes.
Common Mistakes to Avoid:
- Having little or no evidence.
- Being confrontational or unprofessional in the hearing.
- Not using the correct grounds that fit your evidence and situation.
- Arguing against issues that are beyond the scope of the hearing, such as high tax rates.
O’Connor Brings Over 50 Years of Appeal Experience
Whether you are waiting for your informal meeting or are taking your fight to the ARB, we at O’Connor can help. Based in Houston, we have been taking on appraisal districts across Texas and the nation for over 50 years. This extensive experience in the Lone Star State and our resources as a national firm make us uniquely equipped when it comes to appeals. We know the evidence that impresses both the appraisal district and the ARB, and can organize this evidence into perfect portfolios. We can also analyze your appraisal or property and find issues or evidence that might have gone unnoticed.
When you sign up with O’Connor, you get expert representation at every hearing. We back up this representation with data-driven evidence, including massive libraries of home sales and appraisals from our patented databases. We will handle the appeal process for you, saving you hours out of your busy day for hearings, filings, and more. You will also be given a client success consultant, who will act as your main point of contact, giving you a consistent ally who will handle your case and answer all of your questions. There is no cost to sign up, and you will only pay from your savings if we are able to lower your taxes.
Frequently Asked Questions About Informal Appeals
Q: Are high taxes grounds for appeal?
A: No. Appeals target the taxable value of a property, so that is what is being put into question. Taxes and tax rates are decided beyond the control of the appraisal district. Lowering taxable value, however, usually leads to lower taxes.
Q: Do I need a lawyer or a representative for informal or formal hearings?
A: No, but having professional representation leads to a much higher success rate. Taxpayers who do their own appeals see a success rate of around 50%, while those who use O’Connor win over 70% of the time.
Q: When is the deadline to file exemptions?
A: You have until April 30 to apply for exemptions.
Q: What is the worst mistake a taxpayer can make after filing an appeal?
A: Failing to gather evidence or the correct type of evidence for the grounds of the appeal.
