Protest Resources

Short answer is Yes.  Longer answer is Rarely Happens.The ARB is the only authority that can raise a proposed (or “Notice”) market value after it’s published by the Chief Appraiser on or before May 1.  In our experience it has happened only once and that was because our client misled us.  Here’s what happened.  Our client purchased the property for $2,000,000 which was far above the market based on comparable sales and specified that MLS not disclose the price paid.  The district, seeing a non disclosed price, proposed a value in excess of what it felt the market would support — but less than the $2,000,000 purchase price.  (Obviously the owner paid above market for personal reasons.)  Appraisal districts often do this to “smoke out” a protest at which the taxpayer (or agent) will be asked to produce the Settlement Statement.  If there’s no statement produced then obviously there’s no case for a reduction.In cases like that where we don’t have candid information and it looks like the ARB panel is unhappy with the taxpayer’s secrecy, we will withdraw the protest before the hearing is closed to testimony, thus preventing the panel from raising the proposed value.  But where the taxpayer — our client — doesn’t level with us there’s always a risk that the ARB panel, confronted with a non disclosed price and a taxpayer unwilling to be candid, will close the hearing without warning and raise the district’s proposed value.  It can happen especially where an owner is self represented or where an agent is not experienced.  Experience counts. Lesson here is that if you are candid with us as your agent, we can protect you from unwanted surprises.

In an attempt to keep taxes low some home buyers will specify that MLS not disclose the purchase price.It’s not a good idea.The appraisal district, seeing a deed transfer and a non disclosed price will typically propose a value in excess of what it feels the market will support.  Appraisal districts may do this to “smoke out” a protest at which the taxpayer (or agent) will be asked to produce the Settlement Statement.  If there’s no statement produced then obviously there’s no case for a reduction.If the purchase price is less than the district’s proposed value then the Settlement Statement will provide evidence for a reduction.  But if it’s higher and the Settlement Statement is not produced, watch out!  For the consequences of secrecy, read this.

What’s “Market”? That’s what every ARB panel asks and the answer is subjective.  So your value is also.The classic definition, paraphrased, is that market is the price at which a willing buyer not under pressure to sell and a willing buyer not under pressure to buy will agree to receive and pay.For a property which sold within 18 months prior to the January 1 appraisal date, the answer is easy:  the purchase price defines market.  But what if the price included furniture, fixtures, inventory, good will and other intangibles.  If they are itemized on the Settlement Statement or in a separate agreement then there’s a good chance “market” will be adjusted downward.  But if not, don’t even try to argue it unless there’s some other evidence.What if the buyer paid more than market due to extenuating circumstances such as the school year was beginning soon?  We’ve tried it; it won’t work at the ARB. What if you later learned the property was not as advertised; it had structural defects or termites or other problems.  We’ll need third party evidence such as correction or repair estimates to represent you properly.

Rising values are a blessing and a bane to homeowners and the problem is only getting worse in the DFW market. Yes, your equity increases with increasing values but so too do your property taxes.  If you are not planning to move anytime soon, prepare for increased home values and increased taxes.  They make the protest season more important than ever.Here’s what one of our clients wrote recently:”This has been my home since my divorce in 1992, hoping to age in place. Retired from teaching about 5 years ago.  I thought I had planned for everything.

This year sickens me, it’s different. The value of my structure has been halved and the value of my property has been raised $149,000. It looks like the concept of frozen isn’t, or perhaps I don’t understand that. I don’t know where I would go. I paid $128,000 for my home. It had a garage conversion to bed and bath, so my garage/studio is a new and separate structure, 2.5 car garage, rear entry. I hope something can be done but this so looks like a developers dream to me, making me sad and angry at the same time. 72 is too old for that. Appreciate being able to find you.  Please help.“

By end of 2016 affordability throughout DFW has declined to its lowest level since 1991 according to the National Association of Home Builders/Wells Fargo Housing Opportunities Index. The median price for new and existing homes has increased 77 percent since 2010 while median incomes have risen only 4% in the same period. Seven years ago 80% of homes in DFW were within reach of families earning the median income but by late last year that affordability measure had declined to 50%.At the end of 2016 the median home in Dallas sold for $274,000 while in Fort Worth it sold for $212,000 which makes Tarrant County housing more affordable since median incomes are roughly comparable.Land prices — which are difficult to contest when protesting to the Appraisal Review Board because a reduction in one can affect entire neighborhoods — are also rising. In 2010 Dallas, for example, had a 50 month supply of lots; now that same number is down to 20 months supply.For many homeowners the protest process is the only protection against being priced out of their homes.  Paying a professional a percentage of your first year savings can be a bargain when you realize the effect of a successful protest can be felt for many years.  A market value reduction from the ARB should survive for more than one years because in the year following a successful protest the chief appraiser may not increase the value of a homesteaded property without “substantial evidence”.   Also future increases, which are often a percentage applied to the prior year’s value, will come from a lower base.  The difference between what you might get by going it alone to the ARB and what a qualified professional can get for you can be worth far more than the fee when measured over your remaining time in the property.For more about how your protest can survive more than the current year, see where your reduction is likely a “Two-fer”.

We have three major advantages: One is we have access to better data than the appraisal district because you know your property better than they do. Our clients tell us things about their property that the appraisal district often gets wrong, such as condition, size, number of baths, size of garage, etc. So we go in armed with data that contradicts theirs and supports your reduction. Plus, their data is available upon demand. We get it before the hearing and that’s how we can do better than most who protest on their own.Two, appraisal districts are required to inspect the entire county once every three years. In DFW they do this by reappraising where they believe values have increased the most. One result is that many properties are “inspected” only by aerial photography and many others are not inspected at all.Last, appraisers are inclined to resolve appeals informally rather than letting them go to the Appraisal Review Board which is time consuming and expensive. The district is on a budget from the taxing authorities. The appraiser’s concern is making a value change that is supportable. If we have meaningful evidence about, for example, the condition of your property, we’ll get you the value you deserve!

If you are over 65 or “disabled” (see Note 1 below for the definition) and you own and occupy the property as your residence homestead you can defer collection of property taxes until you sell or pass away.You will avoid interest (2% per month) and penalties (starting at 15% the day after taxes would otherwise be due). They can mount quickly if you don’t pay on time or defer before they become due.To defer you must complete the Tax Deferral Affidavit available online by Googling “Form 50-126 Texas Comptroller”Some caveats:1. If you have a mortgage check with the mortgagee. Not all mortgage companies will honor a deferral. Some may require taxes be paid when due.2. Interest on the unpaid taxes will accrue at 8% per annum.3. Any delinquent penalties, interest or attorney fees that accrued before you filed will remain due on the property. So do not delay if you plan to defer.4. The deferred amount plus interest will become immediately due on sale or change in ownership and if unpaid more than 180 days after such sale or ownership change then all standard penalties, interest and attorney fees will be due for the years of the deferral. In other words, you or your heirs have 180 days after sale or transfer of ownership (for instance, through probate) to pay the deferred amount.Note 1: Under Section 11.13(m) of the Property Tax Code “Disabled” means under a disability for purposes of payment of disability insurance benefits under Federal Old-Age, Survivors, and Disability Insurance.

Your Second Chance is Often Your Best Chance – and we’ll share the risk!

After the Appraisal Review Board makes its decision – even after a reduction there – Binding Arbitration is your last resort to get the taxable value you deserve.  It’s also your best resort because it’s played on a field tilted in your favor.

In recent years our clients’ aggregate reductions from Binding Arbitration have been more than double the reductions previously granted on the same properties by the ARB’s.

Arbitration requires a $500 deposit with the Texas Comptroller.  But your risk is only $250 because we will refund half the difference between the deposit and your actual tax savings from Arbitration if they are less than your deposit.  So, for example, if Arbitration saves you only $300, then we will pay you $100.  Clearly, we won’t take a case we don’t think we can win!

Arbitration is played out on an uneven field tilted in your favor because if the arbitrator – who doesn’t work for the District – arrives at a value closer to your request than to the ARB’s value then the District must pay the $500 fee and yours is refunded by the Comptroller.  Thus the District has an incentive to compromise.

Here are some examples of how your neighbors have saved through arbitration:

• For a Tarrant County owner the ARB reduced the district’s $801,000 Proposed Value to $723,000. Through Arbitration that value was further reduced to $700,000, saving a total of about $ 2,500 in first year taxes.  But the owner’s recently incurred costs during construction (excluding land) were $1,100,000 — far more than the district’s $801,000 Proposed Value!
• For a Dallas County owner we obtained a $7,930 reduction from the ARB to $469,000. Through Arbitration we reduced it by an additional $74,000 to $395,000, saving about $2,000 in first year taxes — and demonstrating dramatically that the ARB is only final when you allow it to be.
• For a Tarrant County owner where the ARB had sustained the District’s proposed  $4,067,000 value we obtained a reduction through Arbitration to $3,150,000 which was $250,000 below the owner’s recent cost!  First year savings:  $22,000
• For a Denton owner who obtained his own reduction from $650,000 to $600,000 we obtained a further reduction to $520,000 even though his recent cost was $541,000!  First year savings: $2,000

To sign up, simply return these two Documents. Send no money.

Short answer: Yes, you should protest to the Appraisal Review Board even if you won a property tax reduction last year.  The appraisal district and the ARB consider each year de novo.  (That’s a legal term for “from scratch”.)  What happened last year is irrelevant to the appraisal district and to the ARB.  As they say in the NBA, “That was then. This is now.”

Incidentally, the flip side of de novo is that a substantial increase last year that went unprotested is irrelevant to your property tax protest this year.  The ARB won’t look with any more favor on this year’s protest just because you failed to file a protest against last year’s big increase.  See Why You Should Protest to the Appraisal Review Board Each Year – Regardless

Tarrant County Appraisal District and Denton County Appraisal District are each guided by the same regulations promulgated by the Texas State Comptroller, but they differ significantly in how they operate.  Homeowners who want to know how to protest property taxes would do well to know the differences when protesting to the Appraisal Review Board this year.

Denton Appraisal District:

Denton Appraisal District’s website provides valuable information not found on Tarrant Appraisal District’s website. This includes:

• for your Subdivision: Minimum Market Value, Median Market Value, Maximum Market Value, Median Living Area, Median Square Footage and
• for your Class within your Subdivision: Property Count, Median Market Value, Median Living Area and Median Square Footage.
• for your Property within your Class and Subdivision: Percent Difference from Median Market Value, Percent Difference from Median Living Area and Percent Difference from Median Square Footage.

These granular metrics can be valuable when deciding how (but not whether) to protest to the Appraisal Review Board. If your value is above the median the data can be supportive of your property tax protest seeking to reduce your taxable value. But if your value is already below the median should you nevertheless protest? For our answer see Why You Should Protest to the Appraisal Review Board Each Year – Regardless‍

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Tarrant Appraisal District:

Tarrant Appraisal District’s website provides an Interactive Map from which you can draw your own comparisons of your property’s taxable value with its neighboring properties.  But the hard work of making valid comparisons by subdivision, by class or by similar size property is left to you – and most homeowners don’t have the time to do the grunt work.  At Property Tax Protest we do it for you!