Property taxes in New Jersey are based on the assessed value of your property, which should reflect the fair market value of your home and property. For an assessed value to be considered excessive or discriminatory, it must be proven that the assessment is more than 15% over the equalized fair market value of the property. The equalized fair market value is determined by adjusting the fair market value by the average ratio of assessments in the district in which the property is located – this number can be obtained from your municipality. By law, the current assessment is presumed to be correct, and you must overcome the presumption of correctness to obtain a reduction in your assessment.
To determine whether to file a property tax appeal, you must first establish whether your assessed value, adjusted by the district average ratio, is more than fifteen percent above the fair market value. The fair market value can be determined by comparing sales of similar homes in your neighborhood, or a more accurate but more costly option is to obtain an appraisal from a real estate appraiser. That number is compared with the assessed value of your property, which you receive in a notice from the municipality each year, after applying the average ratio. If the adjusted assessed value is more than fifteen percent above the fair market value, you can file a property tax appeal petition.
The property tax appeal must be based on the property’s fair market value as of October 1 of the preceding year. The petition, along with the filing fee and proof of comparable sales and/or a real estate appraisal, must be submitted on or before April 1 or within 45 days of the bulk mailing of the assessment notices, whichever date is later. A recent law in New Jersey, by way of a demonstration program, moved the filing date in Monmouth County to January 15 or 45 days after the bulk mailing of the assessment notices, whichever date is later.
In many instances, the tax assessor, municipal attorney and the taxpayer agree to a settlement and the assessed value is reduced without a hearing. If a settlement is not reached, a hearing date before the County Tax Board is scheduled.
For more information or advice on whether you are paying more property taxes than the value of your house, please contact LevinCyphers for a consultation.