CHALLENGING PROPERTY TAX ASSESSMENTS
By Attorney Randall J. Andersen
June, 2012
By Attorney Randall J. Andersen
June, 2012
Disclaimer: The information contained on this page is not legal advice. The information provided on this website is for general informational purposes and is not necessarily updated to account for changes in the law. You should consult with an attorney for legal advice regarding your individual circumstances.
Some say nothing in this world is certain except death and taxes. However, the amount of taxes you pay is not so certain.
It is no secret that real estate values have declined significantly during the last six years. It is estimated that the overall value of real estate in the United States has fallen more than 30% since the high point in 2006.
A major part of our overall tax burden in Wisconsin is based on real estate assessments. Assessors are required to value real estate at the “full market value” which means the fair market value at which the property would sell upon an arm’s length negotiation in the open market between an owner willing but not obligated to sell, and a buyer willing but not obligated to buy. In other words, not a forced sale or a fire sale.
The best indicator in value is a recent sale of the property itself in an arm’s length transaction (i.e., not a forced sale or a sale between relatives, etc.). In the absence of a recent sale of the property, appraisers look for comparable sales of similar properties to determine value.
What if you think that your property has been valued too high? The first step is to meet with the assessor and request a reduction. This can occur at the “open book,” which is an opportunity to meet in person with the assessor and discuss the value of your property.
If you are unable to convince the assessor to voluntarily decrease the assessment, the next step is to challenge the assessment. The City of Milwaukee and a few other cities have a “board of assessors,” which is the first step in the appeal process. If your municipality does not have a board of assessors, the first step will be to file an objection with the board of review. The board of review is normally composed of a group of local citizens. In the objection, the property owner is required to indicate his/her opinion as to the value of the property. The board may require the use of a form approved by the Wisconsin Department of Revenue. A hearing date is scheduled, at which the property owner is required to present evidence supporting his/her contention as to value. This could include evidence regarding comparable sales, a recent sale of the property and in some cases, the amount of income generated by the property. The property owner has the right to be represented by an attorney in this process.
The board of review has authority to override the assessor’s determination as to value. If the property owner is not satisfied with the board of review’s decision, there are several options for further review. One option is to appeal to the Wisconsin Department of Revenue pursuant to §70.85, Wisconsin Statutes. If the value of the property does not exceed $1,000,000.00, and the assessment is “radically out of proportion to the general level of assessment of all other property in the district,” an appeal to the Department of Revenue is permitted.
A second method of appealing the board of review determination is to file for certiorari with the circuit court. The circuit court will review the record presented at the board of review, and determine whether the board of review acted appropriately. With a certiorari proceeding, the circuit court is limited to the record presented at the board of review, and is not allowed to accept new evidence.
A third method of review is to file a claim for excessive assessment under §74.37, Wisconsin Statutes. With a claim for excessive assessment, the property owner is given a hearing de novo and is allowed to present new evidence which was not presented to the board of review. This is the method of review which is favored by most attorneys.
As with most things in the law, there are various deadlines, filing requirements and procedures which must be carefully followed to protect your rights in the process. If you feel that your property has been over-assessed, you or your attorney will need to follow the detailed requirements for preserving your rights to challenge the assessment and presenting evidence which supports your position as to the value of the property.
It is no secret that real estate values have declined significantly during the last six years. It is estimated that the overall value of real estate in the United States has fallen more than 30% since the high point in 2006.
A major part of our overall tax burden in Wisconsin is based on real estate assessments. Assessors are required to value real estate at the “full market value” which means the fair market value at which the property would sell upon an arm’s length negotiation in the open market between an owner willing but not obligated to sell, and a buyer willing but not obligated to buy. In other words, not a forced sale or a fire sale.
The best indicator in value is a recent sale of the property itself in an arm’s length transaction (i.e., not a forced sale or a sale between relatives, etc.). In the absence of a recent sale of the property, appraisers look for comparable sales of similar properties to determine value.
What if you think that your property has been valued too high? The first step is to meet with the assessor and request a reduction. This can occur at the “open book,” which is an opportunity to meet in person with the assessor and discuss the value of your property.
If you are unable to convince the assessor to voluntarily decrease the assessment, the next step is to challenge the assessment. The City of Milwaukee and a few other cities have a “board of assessors,” which is the first step in the appeal process. If your municipality does not have a board of assessors, the first step will be to file an objection with the board of review. The board of review is normally composed of a group of local citizens. In the objection, the property owner is required to indicate his/her opinion as to the value of the property. The board may require the use of a form approved by the Wisconsin Department of Revenue. A hearing date is scheduled, at which the property owner is required to present evidence supporting his/her contention as to value. This could include evidence regarding comparable sales, a recent sale of the property and in some cases, the amount of income generated by the property. The property owner has the right to be represented by an attorney in this process.
The board of review has authority to override the assessor’s determination as to value. If the property owner is not satisfied with the board of review’s decision, there are several options for further review. One option is to appeal to the Wisconsin Department of Revenue pursuant to §70.85, Wisconsin Statutes. If the value of the property does not exceed $1,000,000.00, and the assessment is “radically out of proportion to the general level of assessment of all other property in the district,” an appeal to the Department of Revenue is permitted.
A second method of appealing the board of review determination is to file for certiorari with the circuit court. The circuit court will review the record presented at the board of review, and determine whether the board of review acted appropriately. With a certiorari proceeding, the circuit court is limited to the record presented at the board of review, and is not allowed to accept new evidence.
A third method of review is to file a claim for excessive assessment under §74.37, Wisconsin Statutes. With a claim for excessive assessment, the property owner is given a hearing de novo and is allowed to present new evidence which was not presented to the board of review. This is the method of review which is favored by most attorneys.
As with most things in the law, there are various deadlines, filing requirements and procedures which must be carefully followed to protect your rights in the process. If you feel that your property has been over-assessed, you or your attorney will need to follow the detailed requirements for preserving your rights to challenge the assessment and presenting evidence which supports your position as to the value of the property.