Property Tax Appeals
Historically, one could expect the County Assessor to value property for tax purposes in a conservative fashion. However, in recent years, commonly believed to be due to the reduction in property values and thus the reduction in critical tax revenues, the County Assessor has become significantly more aggressive with valuations. Our firm has successfully helped hundreds of clients obtain meaningful reductions to their property tax bills. Over the past ten years, we have about an 80% success rate and have saved our clients an average of about $4000 per year. Our best result was a tax reduction of $14,000 in one year. Our legal background allows us to understand and navigate through the often complex procedural steps, as well as to understand the additional tax reduction factors such as seeking contiguous lot taxation status (discussed below). Our experience in public speaking helps us argue effectively before the County Board of Equalization and in Tax Arbitrations, if required.
The Basic Protest
The County Assessor reevaluates property tax basis every two years. On May 1 of each odd numbered year, you will receive a Notice of Valuation stating the new current actual value of your property, according to the Assessor. This new valuation will apply to the odd year the value comes out, and the following even year. On May 1 of each even numbered year, you will also receive a Notice of Valuation, but it will be the same figure issued May 1 of the prior year, unless you have appealed the value down.
The basis for valuation is often confusing to the property owner. The County Assessor is required by law to appraise all real property by examining sales that occurred within an 18-month period that begins over two years prior to the date the updated valuation is issued. For example, for tax years 2013 and 2014, the County Assessor will examine sales January 1, 2011 through June 30, 2012.
For tax years 2013 and 2014, the valuation will come out May 1, 2013. The property owner then has until June 1, 2013 to file an appeal of the valuation. Our firm is available to prepare and file these appeals. Again a valuation will also come out May 1, 2014, and you have until June 1, 2014 to file an appeal of that valuation, but that appeal would only address 2014 taxes. However, if successful, you could then file a Petition for Abatement of 2013 tax bill.
This "Petition for Abatement" process allows property owners to effectively appeal tax valuations beyond this June 1 deadline. The best route is to adhere to the June 1 deadline. However, if you purchased property after the June 1 deadline, or you missed the June 1 deadline, you can still effectively appeal the valuation for the subject year by filing a Petition for Abatement.
If the County Assessor grants the appeal, the valuation (and thus the property tax bill) is reduced.
Appeal to County Board of Equalization
If the County Assessor denies the appeal, the property owner can file an appeal with the County Board of Equalization (BOE). Based upon the timeframes states above, an appeal to the BOE would be due around July 16, 2013. Then, the BOE will notify the appellant of the hearing date and time. We typically appear at this brief hearing for the client. Again under the above timeframes, the BOE will render a decision typically by around August 2, 2013.
If the BOE grants the appeal, the valuation (and thus the property tax bill) is reduced.
If the BOE denies the appeal, the property owner has three choices: (1) file an appeal with the State Board of Assessment Appeals; (2) file an appeal with the local District Court; or (3) request a binding arbitration hearing. The property owner must take one of these three steps within 30 days of the BOE decision. Our office typically recommends option #3, requesting binding arbitration, as the most cost-efficient method.
Contiguous Lot Taxation Status
Vacant land is taxed at a rate over three times the rate used for improved property.
However, if you own vacant land adjacent to improved property, you can process a lot line adjustment to merge the vacant land with the improved lot, and thus achieve a tax reduction.
However, many clients prefer the flexibility of maintaining the lot line in place. Fortunately, there is a process to allow this to happen, yet still enjoy a property tax reduction. We can request the Assessor characterize the vacant land as "contiguous" and thus reduce the tax rate on the vacant land to the lower improved property rate. This contiguous lot classification usually requires the installation of some landscaping and minor improvements on the lot so it satisfies the contiguous land standard. C.R.S. sec. 39-1-102(14.4)(a) states in relevant part, "'Residential land' means a parcel or contiguous parcels of land under common ownership upon which residential improvements are located and that is used as a unit in conjunction with the residential improvements located thereon." This typically means that if you have a driveway running through the vacant lot, or perhaps some landscaping and minor improvements on the vacant lot (such a path, barbeque area, gazebo, patio, etc.), you will qualify for this contiguous lot status. You need to ask the Assessor to change the tax classification. If the vacant lot has no such improvements on it, you can retain a landscape architect to come up with a proposed plan, show it to the Assessor to ensure it will qualify, and install it. The improvements must be in place by January 1 in order to qualify for the contiguous lot status for the applicable tax year. We have saved several clients literally tens of thousands of dollars per year.
As stated, our firm is uniquely positioned to assist property owners with protesting valuations, navigating through the often complex procedural steps involved, and understanding additional rights and remedies to manage property tax bills.