I am often asked about the results of a tax appeal appraisal, and whether it really is worth the effort to file an appeal. One dramatic example may provide an answer.
I was asked by a client to appraise a number of mixed-use properties (retail/commercial on the first floor, apartments on the upper floors) he owns in Somerville, Somerset County, New Jersey. Several years ago, the Borough of Somerville underwent a revaluation, whereby every property in town was re-assessed for tax purposes. In the course of revaluing one of the properties owned by my client, the appraiser for the revaluation company made a significant error in calculating the gross building area of the building, so that a building of just over 16,000 square feet ended up being assessed (and, therefore taxed) based on approximately 26,000 square feet! Needless to say, this resulted in a substantially higher annual tax bill than would have been the case with an accurate calculation. When I brought this to the attention of the municipal Tax Assessor, he acknowledged the error and made the necessary correction to the property record. The end result? By correcting this error, and by providing a complete appraisal report that detailed the market value of the property as of October 1 of the pre-tax year, my client’s tax bill was reduced by more than $24,000 – every year.
Granted, this is obviously an extreme case, where a property’s over-assessment was due mostly (although not entirely) to a mechanical error in the property records. Still, wouldn’t it be prudent to find out what your own assessment is based upon?