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With housing values down more than 34 percent
in the last two years, Metro Detroit homeowners
are pretty much out of options for getting any
cash out of their homes.
For the large and growing number of
homeowners who owe more than their houses are
now worth, refinancing is out and so is a sale.
But there is one small sliver of hope: lowering
your property taxes. This month, local
municipalities will be mailing out property tax
assessments, many reflecting the kind of values
homeowners in this region won't see again for
years, experts say. Homeowners who act promptly
can appeal the assessed value of their
properties and cut a big chunk out of their tax
bills. Lee Morof, is a Southfield attorney who
handles tax appeals. One client has a tax
value that is more than three times the real
value of her home, he adds. "It's costing her an
extra $2,000 to $3,000 a year. She's having
trouble making her house payment, and she needs
that money." The first step is to check your
mailbox for your notice of assessed valuation.
Check the state equalized value, or SEV, which
is typically about half of what the assessor
says your house is worth on the market. (Your
taxable value times your millage rate is what
you pay. The tax value is based on the SEV, but
adjusts from year to year, for reasons too
complicated to go into here.) If doubling your
SEV produces a figure you think is much higher
than what your home would sell for, you might
want to appeal the assessment. You can do that
yourself, hire an attorney or specialist, or get
come coaching from resources on the Web. One
resource is the recently launched
my.taxappealteam.com, a Web site that offers
a tax savings calculator and video tutorials on
appealing your tax assessment. The
Southfield-based company was created after
entrepreneur Jim MacKay watched a friend of his
lose an assessment. "He presented all the
wrong information, and they didn't have any
option but to deny him," MacKay says. For less
than $100, his Web site will help users come up
with a good valuation for their homes and show
how to put together a package for an appeal. Other sources for a valuation are contacting
your real estate agent and getting lists of
recent sales of comparable homes in your
neighborhood, with three sales that support your
argument for what the property is worth. Or you
can hire a property appraiser, which costs about
$300 to $350. Once you've got supporting
evidence for a new, lower value, schedule a
hearing with your city's board of review, which
is a local, often volunteer panel that will hear
your appeal, only in March. Contact your City
Hall for specifics. Detroit residents must
first get a Board of Assessors review by
inspecting the assessment rolls between Feb. 1
and Feb. 15 and filing an appeal. If their
appeal is not granted, they can then go the
Detroit board of review in March. The deadline
for a response from the review board is June 1.
If the board doesn't lower your value, you can
appeal to the Michigan Tax Tribunal. You can
find instructions and an appeal form at
Michigan.gov/taxtrib, or send a letter to the
tribunal requesting an appeal, and an
application will be sent to you. The deadline
for filing is July 31. The tribunal appeal can
take a few months, or drag on for years. Appeals
have increased, and last year the tribunal had
30,000 claims filed, according to the chief
clerk. Even though the process takes more than
two years in some cases, homeowners who win
their appeals get all the excess tax refunded.
But that doesn't mean homeowners can cut their
tax payment or stop paying taxes just because an
appeal is pending, experts say. That could end
up with you owing interest and penalties on
unpaid taxes, even if you win your assessment
argument. It seems like a lot of time and
hassle, but the process can pay off, especially
for homeowners who bought near the peak of the
market in late 2005 and early 2006. "About 90
percent of the people I see, if they bought five
years ago and they're not doing this, then
they're leaving money on the table," says Morof,
the attorney. "And I don't know anybody in this
economy who couldn't use the money."
boconnor@detnews.com
(313) 222-2145
From The Detroit News:
http://www.detnews.com/article/20100201/BIZ01/2010308/1010/Lower-home-value--lower-taxes?-If-not--consider-an-appeal#ixzz0eV60ZNq1
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