Appealing Wailea Makena residential property tax assessments: condos, homes, land, new developments
Do your homework before appealing your tax assessment (Letters to the Editor)
Viewpoint: Bruce Faulkner
reprinted courtesy Maui News 3/26/10
By now Maui County property owners should have received the county's annual assessment of their property's value. This event is often associated with a lot of confusion about how the county arrived at its assessment and, in some cases, a decision is made to file an appeal.
While you have the right to appeal your tax assessment, know this: 98 percent of such appeals do not succeed. To avoid wasting valuable time and adding to the logjam to the county's Board of Review, do your homework.
The wait time for property owners who have filed an appeal is already more than a year long.
The Realtors Association of Maui would like to offer homeowners who believe they are being overtaxed by the county the following thoughts on the process before they choose to appeal their assessments:
2010 assessments are not based on 2010 market values. The actual tax value is based on the market as it was about a year and half before the assessment was mailed. Your property probably was worth more then than it is now.
In order to make a successful appeal, you will need market data from the period of July 1, 2008, to June 30, 2009. This is where a Realtor can help. Our multiple-listing service is capable of retrieving that type of information. A Realtor can perform a comparable market analysis, which will give you the data needed to decide if you have grounds for an appeal.
In most cases, an appellant will have to be able to show at least a clear 20 percent differential between the county's assessed value and market-based evidence. If the assessment says that your property was worth $500,000 a year and a half ago, you will have to show that it was actually worth less than $400,000. If your evidence does not clearly demonstrate that 20 percent separation, your appeal will likely fail.
The type of evidence you provide has to be the same type of data that an appraiser uses: comparable sales from your neighborhood, of properties similar to yours, using the same time frame as the assessment.
The deadline for filing for a homeowners exemption is Dec. 31. Failure to make that deadline can not be appealed.
Another stumbling block involves leasehold apartments. Because the leasehold apartment owner does not have a fee-simple interest in the ground under the apartment, the market value of a leasehold apartment is often considerably less than similar fee-simple apartments. But the law does not recognize the difference when it comes to property taxes. Leasehold properties are taxed as if they are fee simple. We often hear leasehold apartment owners complain that is not fair. It may not be but it is how the tax code is written and appeals based on leasehold values not being equal to fee simple do not succeed.
Appeals are heard by a five-member panel of citizen volunteers called the Board of Review. They are providing a service to the community, so please don't treat them like the enemy. The rules they have to work with are clear and not flexible. The board does have the power to correct assessments if you can prove that your assessment is too high. It does not have the authority to reduce assessments because the property owner cannot afford their tax, or to adjust tax rates.
The appeal deadline is April 9, the only exception is for active-duty military personnel in combat zones.
If you are thinking about appealing your real property tax assessment, please do your homework first. If you need help getting your comparable data, contact a Realtor. For more information about the appeals process, see our Web site at ramaui.com/rpt.html.
Bruce Faulkner is the president of the Realtors Association of Maui.
reprinted courtesy Maui News 3/26/10, original link www mauinews.com/page/content.detail/id/529920.html?nav=18
brought to you by Wailea Makena Real Estate Inc.
www.Wailea-Makena-real-estate.com
Peter Gelsey R (PB)
Wailea Makena Real Estate, Inc.
direct (808) 344-8000
Toll free 800-482-5089
fax (808) 442-0946
email peter@petergelsey.com
Disclaimer: we have no information if the content of these articles is correct or not, we are reprinting them only for interest and general information. For legal advice please contact an attorney.