New Jersey Property Tax Appeals
We service Hoboken, Hudson County, and the entire State of New Jersey. Hoboken is used here as an example, but this analysis applies to any residential or commercial property in New Jersey.
1. How does Hoboken determine my property taxes?
Hoboken calculates your property taxes by multiplying your property’s assessed value by the property tax rate for that given year.
For Example:
2010 Assessed Value = $200,000
2010 Property Tax Rate = 4.745%
2010 Property Tax Bill = $9,490
2. How do I find my assessed value and property tax rate?
You can find your assessed value by going to www.njactb.org and doing a record search by your property address.
You can find your property tax rate by looking at the list on the following website. http://www.hudsoncountytax.com/html/RatesRatios.aspx.
3. Why is my assessed value different from the price I bought my home for?
All municipalities in New Jersey, including Hoboken, make their assessment on a percentage of the property’s assumed value. For Hoboken, that percentage for 2010 is 27.16%. This information is also available at http://www.hudsoncountytax.com/html/RatesRatios.aspx.
For the example above, the tax assessor’s opinion of your property’s value can be derived by dividing the assessed value by the ratio.
For example:
2010 Assessed Value / 2010 Ratio = 2010 Assumed Value
$200,000 / .2716 = $736,377.03
This means that the Hoboken Tax Assessor thinks your property is worth $736,377.03 in 2010.
4. Wait a minute! What if the value the assessor thinks my property is worth is higher than what I think my property is worth today?
Given the economic downturn, thousands of properties in Hoboken are improperly assessed and as a result property owner’s are paying higher property taxes than they should be. It is your right to challenge the assessor’s valuation of your property with an appeal.
5. I think I am paying too much in property taxes. How can I appeal my property tax bill?
Property taxes are the result of the local budget process and may not be appealed but the property’s assessment may be. Your tax bill is a function of your assessment times the tax rate. If your assessment is reduced, your tax bill will be reduced. A taxpayer considering an appeal of his property tax assessment must prove that the assessed value is unreasonable compared to a market value standard.
6. You say I can appeal if the assessed value is “unreasonable”. What qualifies as an “unreasonable” assessment.
State law allows each municipality a 15% margin of error in either direction from the municipal ratio. For 2010 the Hoboken range was 23.086% to 31.234%.
In order for your property to qualify for a property tax reduction you must find what we call the “Sweet Spot Market Value.” This is the maximum market value which will still qualify your property for a reduction in your property tax assessment. Any appraisal that shows your property is valued at this level or less, will qualify for an appeal.
For example:
2010 Assessed Value = $200,000
High End of Range = 31.234%
Sweet Spot Market Value = 2010 Assessed Value / High End of Range
Sweet Spot Market Value = $640,204.87 ($200,000 / .31234)
What the “Sweet Spot Market Value” calculation is saying is if your property appraises for $640,204.87 or less, you will qualify for a reduction of assessed value.
7. How do I investigate what my property is really worth on the market, to see if it is less than the Sweet Spot Market Value?
A great place to start is a real estate website called www.zillow.com which provides current and historical estimates of property market values.
* Remember, the values derived from Zillow are only an estimate. Each property has unique attributes that impact its market value.
For purposes of this example, assume the Zillow estimate for your property comes in at $538,000.
8. Now that I have an estimate of my property’s market value from www.zillow.com, how do I find out if I qualify for lower taxes.
With a market value of $538,000, you are well below the Sweet Spot Value of $640,204.87, so you can proceed with an appeal.
If you win your appeal, your property will receive a new tax assessment. The new tax assessment will be calculated by multiplying the updated market value by Hoboken’s municipal ratio.
Updated Market Value x Municipal Ratio = New Assessment
For example $538,000 x .2716 = $146,120.08
9. Once I have estimated my new assessment, how do I calculate my tax savings.
To find your tax savings, compare your tax bill under the old assessment with your tax bill under the new assessment.
Per the example, the old tax bill (in Question 1 above) was $9,490 based on the tax assessor’s $200,000 assessment.
Adjusted Estimate x Tax Rate = Updated Taxes
$146,120.08 x 4.475% = $6,933.40
Old Tax Bill – New Tax Bill = Tax Savings
$9,490 - $6,933.40 = $2,556.60
10. Wow! A tax appeal could save me $2,556 dollars. How do I get started?
You need to file an appeal to realize any tax savings. In your appeal you must suggest a more appropriate value by showing the tax board the market value of the property. The taxpayer must be persuasive and present credible evidence. Credible evidence is supported by fact, not assumptions or beliefs. The most credible evidence is recent comparable sales of other properties of a similar type in your neighborhood.
11. When do I need to file my appeal?
It is important to remember that there is a deadline by which to file a tax appeal. The appeal must be filed by April 1st. This deadline is strictly enforced and the township requires that they receive the completed application by the deadline.
12. When should I start?
This is URGENT. The process should be started as soon as possible.
As an appellant, the burden is on you to prove that your assessment is in error, unreasonable, excessive, or discriminatory.
To meet this burden, you will need to take a number of steps, including conducting an appraisal, preparing an application, and filing the application. The filing of the application should be done several weeks before the deadline.
13. Can I file the appeal myself, or do I need an attorney?
You can file a tax appeal on your own. Individual taxpayers may represent themselves before the County Tax Board.
If you choose to represent yourself, you should make sure you understand the procedures of the County Tax Board, as you will be required to file your appeal properly and make a persuasive argument to the board in support of your application.
Your application may be thrown out for a technicality if you do not meet the required filing requirements and follow proper procedures. Additionally, a hearing is always required for a tax appeal.
At the hearing, a municipal attorney will argue against you. This attorney will use their own comparable sales and other evidence to support the township’s assessment. The municipal attorney may challenge your appraisal and even challenge the qualifications of the appraiser himself. The municipal attorney is a professional who is well versed in the tax appeal process. If you decide to present your appeal yourself, you must be confident enough in your ability to prosecute your case and defend your stated market value against the municipal attorney’s attacks.
14. My realtor said they could help me with my property tax appeal; is this true?
A realtor may be able to assist in providing you with comparable properties from the MLS and may be able to explain the application and the process to an appellant. However, please remember, comparable sales information is available for free at www.zillow.com. A realtor cannot provide you with an appraisal that you can use in your hearing. The rules of tax appeals limit expert witnesses at a tax appeal hearing to anyone employed as a real estate appraiser, and designated as such from a legitimate association of professionals, according to licensing or certification requirements of the State of New Jersey. A realtor is not qualified to testify at a tax appeal hearing.
15. Why do I need an appraiser when you’ve already told me about free comparables at Zillow and when my realtor can give me examples from the MLS.
Only an expert, licensed as an appraiser, is qualified to determine which properties are similar enough to yours to use in valuing your property.
16. What are comparable sales?
Comparable means that most of the characteristics of your property and the neighboring properties sold are similar. Be able to give full property descriptions and be knowledgeable of the conditions, including financing, of the cited sales. These include: recent sale price, similar square footage of living area, similar lot size and acreage, proximity to your property, the same zoning use, and similar age, construction and style.
17. Do I need to hire a tax attorney?
It is helpful to have a Tax Attorney in your corner fighting for you to give yourself the best odds of success.
I would love to discuss your case with you. I am passionate about saving homeowners money when they are unnecessarily overpaying their property taxes.
DISCLAIMER: Every property and every property tax situation is unique. Also, the 2011 property tax rate has not yet been released, so tax savings may vary. The explanation above is based on the numbers in the example. Please contact a property tax professional for a complete assessment of your unique property.
I am a Tax Attorney with an advanced masters degree in tax law known as an L.L.M. from NYU School of Law. I can guide you through this sometimes confusing area and analyze your particular situation. I do not charge for analyzing whether your property qualifies. I work with Michael Mazzola, who is a licensed New Jersey Real Estate Agent with over 10 years of experience and who knows the local real estate market in Hoboken.
AVAILABILITY
Our team is passionate about helping homeowners with property tax appeals. In addition to normal business hours, we are available to take phone calls and to meet on nights and weekends. It is our goal to make this process as convenient and hassle free for you as possible.
CONTACT INFORMATION
John P. Fazzio, Esq., L.L.M. in Taxation
Cell: (609) 868-8953
Fax: (917) 591-1803
E-mail: jfazzio@fazziolaw.com
Michael Mazzola, VP Business Development
Licensed N.J. Real Estate Agent
Cell: (973) 668-0018
Fax: (201) 604-6696
E-mail: mmazzola@fazziolaw.com
Fazzio Law Offices
2500 Plaza 5
Harborside Financial Center
Jersey City, NJ 07311
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