Real Property Tax Appeals
In Washington State, the county assessor values real property to reflect the property’s true and fair market value, in accordance with its highest and best use. The assessor bases the value on what a buyer in an arms-length transaction would pay for the property.
The county assessor may use several different methods to appraise real property for the purpose of establishing tax assessed value:
- Cost Approach
- Market Approach
- Income Capitalization Approach (for properties that produce income)
Sometimes, the assessor will utilize some combination of these approaches. The assessor must reassess real property on an annual basis and must conduct physical inspections no less than every six years. The assessor will typically value the real property based upon an appraisal date of January 1st of the year preceding the pending tax year. The assessor will send a Change of Value Notice to the real property owner each year reflecting the new assessed value.
If a property owner feels that the assessor has over-valued the property, or otherwise wants to challenge the valuation, that property owner can file an appeal. The appeal deadline falls on either: (1) July 1st of the assessment year, or (2) within 30 or 60 days (depending on the county) of the date when the assessor’s office issued the Change of Value Notice, whichever is later. A property owner can file the appeal online, deliver the appeal form to the board of equalization, or mail the appeal form so long as the mail has been by midnight of the deadline. The county may waive the deadline in several circumstances, some of which include, the death or serious illness of a taxpayer or taxpayer’s immediate family member, a taxpayer’s absence from the home where the assessor mailed the notice, or any delay or loss by the post office.
The appeal form must include the taxpayer’s specific reasons, based upon market considerations, as to why the taxpayer believes the assessor has improperly valued the property. Some common sources of information include a recent appraisal, evidence of property deterioration, and sales comparisons reflecting a lower valuation. The appeal must also include the parcel number of the property, the assessor’s valuation, the taxpayer’s estimate of value, comparable sales or other supporting evidence, and an indication of whether the taxpayer will submit additional evidence prior to the hearing. Generally, the taxpayer must provide all relevant information at least twenty-one (21) days prior to the hearing date. The hearing will be held with the board of equalization and the assessor’s office representative, and the clerk of the board of equalization provides the date, location, and time of the hearing after the taxpayer has submitted the appeal. A taxpayer can self-represent or have representation through an authorized agent.
The taxpayer bears the burden of proof in these appeals. By law, the board of equalization will presume the assessor’s value correct. The taxpayer must therefore present clear and convincing evidence in support of their proposed market value. At times, the assessor may stipulate to a different valuation in the face of such evidence. Other times, the parties will end up in front of the board of equalization for adjudication. Taxpayers do sometimes succeed in these appeals, but it requires diligence and strong evidence. If a taxpayer remains dissatisfied with the board’s decision, the taxpayer has further appeal rights.
This post only outlines some aspects of the tax appeal process, and readers should not use it as a definitive guide. The attorneys at Beresford Booth frequently address real estate matters for a variety of clients, including a variety of challenges facing real property owners.