When it comes to taxes, April 15th shouldn’t be the only date on your mind. If you own a home in New Jersey, April 1 is the deadline to appeal your property taxes. If you miss it, you will have to wait another year before you can file.
New Jersey has the distinction of having the highest property taxes in the United States. If you own a home in the state, the only way to reduce the annual payment is to prove that the assessed valued used to calculate your property taxes is excessive.
The standard measure of property value in New Jersey is “true value” or market value, which is defined as “The most probable price in terms of cash or cash equivalency which a property will bring in a competitive and open market under all conditions requisite to a fair sale…”. Property taxes, in turn, are calculated based on the assessed value of your property, which is supposed to approximate the market value. What works in theory, however, doesn’t necessarily work in practice, and so it’s not uncommon for an assessment to exceed market value.
Homeowners who believe that their assessment is greater than the market value have the right to appeal the assessment. But it’s unrealistic to expect that every home in New Jersey will be assessed perfectly, so the state’s tax laws were written to provide some room for error. As a result, assessments are considered valid when the assessed value falls within a range of plus or minus 15% of market value. To make an appeal worthwhile, the difference between what you believe your home is worth and its assessed value needs to be meaningful.
By law, your current assessment is assumed to be correct. To prevail, you must be persuasive and support your argument with facts, not assumptions or beliefs. The most credible evidence you can present is recent comparable sales of other properties of a similar type in your neighborhood. The actual appeals process is fairly prescriptive and some homeowners will choose to go about it alone. However, the process can also be technical and since most homeowners don’t know what a common level range is or how to apply an equalizaton ratio, many choose to hire an attorney. The good news is that most work on a contingency fee arrangement, taking a percentage, often as much as 50%, of the first year’s savings.