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My Property Taxes Are Going Up How Much?!

Property Tax Protest: What it is and how to do it.

If you’re a homeowner in Texas, you’ve recently received your Notice of Appraised Value from your Central Appraisal District.  If you’re like many others, various emotions arose after opening that envelope; shock, disbelief, and maybe even fear.  Owner Occupants ask themselves “How much is my payment going up?”, and Investors are asking “How much is my cash flow going down?” The questions both are asking are “Can I protest? Should I protest? How do I protest? What information do I give them? Which boxes do I check? Can I do it online? Do I need a PIN? Do I have to provide the information they ask for? Do I request a formal or informal hearing? Should I just sell? This is crazy!” 

This article will walk you through the process of how to protest property taxes, explain what protests are, who should use them and how they work. 

Property Taxes – Why? 

Texas is one of seven states in the U.S. that do not collect personal income taxes and as a result, the State relies heavily on property taxes to fund essential community needs for the City, County, School District, and Special Districts in which the property is located. While Texas’ property tax rates are relatively high when compared to other States, a resident’s overall tax burden remains one of the lowest in the nation. 

Notice of Tax Appraised Value 

If the appraisal district appraises your property at a higher amount than in the previous year, Tax Code Section 25.19 requires the appraisal district to send a notice by May 1, or by April 1 if your property is a residence homestead, or as soon as practical thereafter. 

If you are dissatisfied with your appraised value or if errors exist in the appraisal records regarding your property, you should protest by submitting Form 50-132, Notice of Protest (PDF). In most cases, you have until May 15th, or 30 days from the date the appraisal district notice is delivered — whichever date is later. 

There is a PIN on your Notice of Appraised Value; you’ll need this if you decide to protest online through your County Appraisal District website. 

Should I Protest? 

If you purchased your home in the previous year, and you purchased your home for less than the appraisal district’s proposed value, and the appraisal you received when you purchased the home is also less than the appraisal district’s proposed value, you should protest. On Form 50-132, when asked what your opinion of the home’s value is, use the higher of the two (sales price or the amount on your purchase appraisal). The appraisal district will ask for evidence of your sales price which can be accomplished by providing them with your Closing Disclosure. They will also ask you to provide the appraisal you received during the purchase process. You will need to provide both.

If you’ve owned your home for longer than a year and you think the appraisal district is over-valuing your property, but you don’t have evidence, time, or the expertise to go through the protest process on your own, hire a third-party tax firm to help you with your protest. A simple google search for “Austin Texas property tax protest companies” will deliver several results to get you started.  

Why I’m Protesting – Which Boxes do I Check? 

Form 50-132 gives you several checkboxes to choose from to tell them why you’re protesting. Most often, homeowners are checking “Incorrect appraised (market) value and/or value is unequal compared with other properties.” Be sure to check all boxes that apply (or may apply) as you may not have the ability to protest under an issue if you don’t check that box at the time you submit the protest. 

Informal vs. Formal Hearing 

Start by requesting an informal hearing and delivering the evidence you’d like the appraisal district to consider to adjust your value. If their response is unsatisfactory, request a formal hearing. At the formal hearing you will be sworn in under oath and you will present your case in front of a volunteer panel of Citizens. The hearing is recorded. Keep in mind that throughout the protest process (formal or informal), the appraisal district can also choose to raise your assessed value, not just lower it. Be sure you’ve got compelling evidence that will withstand scrutiny. Again, you might want to hire a professional for this part. I have been through formal hearings at the Travis County Appraisal District, Hays County Appraisal District, and the Caldwell County Appraisal District; even as the owner of a real estate brokerage I don’t ever want to protest at a formal hearing again – I’d most likely hire it out. 

Have more questions about property taxes, your home’s valuation, or the protest process? Give us a call for solid advice and guidance.