4 Tips to Save $ on Property Taxes

Most of us do not enjoy paying taxes, and many hire professionals to make sure we are getting all of the deductions we are entitled to on our Federal Income Tax. One of the major blessings of living in the Sunshine State is we don’t have State Income Tax. But all homeowners do owe Property Tax. This is the time of year to look at that, to make sure we are not paying more than necessary. Here are a few ways of decreasing the amount of Property Tax owed.

Property Tax

I think it is important to understand how the tax works before diving into ways to save you some money. Property Tax is based on the Assessed Value of your home. Assessed Value is the value of your home as determined by the city or county where the home is located. A property assessor will determine how much your home is worth based on a few factors. It is not the actual market value or the most recent price the property was bought/sold for. The rate you pay on the Assessed Value is called the Millage Rate and is determined by local law. The city or county holds votes occasionally if it would like to change the rate. Rates are generally not lowered and may be increased to pay for things like schools or other infrastructure. You will receive a notice of proposed taxes in the mail at the end of the year.

1. Homestead Exemption

Simply qualifying for it does not make the exemption automatic. It must be requested by the homeowner and you have to qualify. The home must be your primary place of residence, and must also qualify. Many houses, condos, co-op apartments (if owned), and some mobile home lots qualify for the exemption. You should apply even if you are not sure your home qualifies. In Florida the first and third $25,000 of your home’s value is exempted. Basically, if your home is worth $75,000 or more you only have to pay tax at the Millage Rate on the value above $50,000. Application for homestead exemption must be done before March 1st for that year, and can be done a number of ways. For more information in Jacksonville visit: http://www.coj.net/departments/property-appraiser/exemptions.aspx

2. Disabled Veteran Exemption

This is more of an add-on to the above exemption. If the homestead is owned by a veteran who has a 10% or more service connected disability, an additional $5,000 exemption is added. So disabled veterans pay tax on assessed home value in excess of $55,000 on a home assessed at $75,000 or more. You will only need your VA eligibility letter to prove disability rating in addition to the process above.

3. Disputing the Assessed Value

Many of us live in our homes for quite a while and over the years you will likely see the assessed value of your home change. If you bought at the bottom of the market the assessed value may be quite a bit higher than the amount you paid, or much lower if you bought at the height of the market. The assessed value is supposed to be a good representation of what the property is worth in the given year based on recent sales in the area. If you feel that your home has been assessed too high you can dispute the value. You can appeal the value using Florida form DR-486, either in person or through the mail. The process is not free, it costs $15.00 per property so it may not be worth filing for a very minor adjustment. If you need some help determining the value of your home we can help do a market analysis to determine the approximate value. It is important to have a good case (complete with pictures of your home and comparable homes in the area that sold in the last 12 months), especially if you are presenting in person. If you have any questions about where to go or where to mail the form let us know.

4. There are professionals that will do the appeal for you.

If you don’t have the time nor desire to do the appeal yourself, there are firms out there that would love to take on the process for you. If you stand to save a significant amount of money from lowering your homes assessed value this is could be the best way to go about it, keep in mind everything has a cost.