Property Tax Assessment Appeal

Some things you should know about your property tax and how to make an appeal in the State of New Jersey (Ocean County and Monmouth County only).

1. You can't appeal your property tax. What you can appeal is the property assessment upon which your property tax is based. The deadline for this appeal to your borough or township is April 1 of each year. You can still appeal your assessment after April 1, but not to your borough or township. It must then be appealed to the County. Whether or not you win the appeal, your property tax will not change until the following August 1 (the beginning of the municipal tax year)

2. Property assessments are assigned to establish a base upon which your property tax is based. The assessment is not what your municipality says a buyer will pay for your property. It is for tax purposes only. The assessment is divided into two parts: the land value is what the town values your land at. The improvement value is what the town values everything that is upon the land. The improvement value is determined by the age of the building, and square feet of living space. You'll probably notice that your assessment hasn't changed recently. It stays the same for several years until the borough or township is mandated by the State to reassess all properties within the borough or township. Here's an example of how the municipality arrives at your property tax. Let's assume that your property has a total assessment of $300,000 and the tax rate in your municipality is $2.50 per $100 of assessed value. $300,000 divided by 100 x $2.50 = $7,500.

3. Many property owners panic when they hear that the municipality has ordered a new assessment of all properties. The new assessment will be approximately 90% of what similar properties sold for during the 12 months immediately preceding the beginning of the assessment period (usually it takes 6-12 months to complete the reassessment). Sales that took place outside that 12 month period are not considered. The municipality hires a Tax Appraisal Company to do the work. Depending on the number of properties their fees can easily run into $Millions, which is why assessments are not changed for many years. What does change is the tax rate. It changes yearly based on the Municipal Budget. For example. Let's says your municipality does a reassessment and your new assessment doubles to $600,000, but the tax rate is reduced to $1.30 per $100 of assessed value. $600,000 divided by 100 x $1.30 = $7,800. Your assessment was increased 100%, but your property tax increased only 4%.

4. Here's what happens. The municipality establishes a budget. Every property owner has to pay their share of that budget. Your property taxes are your share of that budget. Since assessments are expensive and your taxes pay for them, the municipality adjusts its tax rate to coincide with its budget. The great unknown is what will the tax rate be after the new assessment is completed.

Let's says you hire me as a consultant in preparing your tax assessment appeal. The municipality has sent you notification that your new assessment is $600,000. I prove that properties comparable to yours sold for $550,000, and the new tax rate is $1.30 per $100 of assessed value (see 2 & 3 above). $550,000 divided by 100 x $1.30 = $7,150. Beginning the following August 1 your annual property tax will be $650 less and will remain $650 less until the municipality establishes a new tax rate. Remember that the municipality changes the tax rate every August 1. It is a rare occasion when a tax rate is not changed, but no matter what they do with the tax rate, your taxes will be lower because you have lowered the basis upon which your taxes are based; namely your assessment.

Tax Assessment Consultation Fees*
Residential Properties Only

50% of the fee is due on my first visit to your property. After previewing the property I will gather together all the sales data necessary to make the appeal. The balance of the fee is due at our second meeting. At our second meeting I will go over this data in detail. You will attach this data to your tax appeal for presentation to the municipal county tax assessor. I cannot guarantee that your assessment will be reduced, but I can say that with the proper paperwork attached, your chances are very good. If your assessment is not reduced, I will refund 20% of the fee. I do not normally accompany the property owner to the assessment appeal hearing. After our second meeting you will be fully prepared to handle the meeting. However, if you want me to accompany you, there is an additional flat fee of $250* which in non refundable in whole or in part, and is payable before the hearing commences. If the hearing is cancelled by the municipality or county, I will accompany you a second time for no charge. If you cancel the hearing, and inform me of the cancellation at least 24 hrs. in advance of the hearing time, there is no additional charge.