Countdown for Annual Tax Assessment Appeal Filing
The deadline for challenging your 2014-2015 Lancaster County property assessment is August 1, 2014. Appeals filed after August 1, 2014 won’t be heard until 2015 and won’t take effect until 2016. And if you are relying upon an appraisal to support your appeal, the written appraisal report must be filed with the Lancaster County Assessment Office by August 15, 2014. This means the time to act is now.
How do you know whether an assessment appeal is warranted? We look at the current assessment, the common level ratio, the current total tax millage rate and evidence of current fair market value. Current assessments and property account numbers are posted online. (The property account number, and in some cases, the assessment, is listed on recently issued school district real estate tax notices.) The common level ratio (CLR) is the factor applied to the assessment that converts the assessed value into fair market value. As of July 1, 2014, the common level ratio increased to 1.26. Total tax millage rates now include 2014-2015 school district taxes.
Property owners should multiply their assessment by the CLR (1.26) to see if the fair market value is accurate. For example, an assessment of $100,000 implies a fair market value of $126,000 [$100,000 times 1.26].
The millage rates tell you the total amount of your annual property tax. The first three digits of the property account number signifies the municipality in which it is located. Assuming that the $100,000 property is in East Hempfield Township, the total millage (county, municipal and school) is 24.5140. Multiply that millage rate by your property assessment, divide by 1,000, and the result is the annual property tax load. In the $100,000 East Hempfield instance, the total annual taxes would be $2,451 ($100,000 x 24.5140).
If the East Hempfield Township property owner has had an appraisal, preferably in the last year, stating that the fair market value of the property is not $126,000 but rather $100,000, the application of the common level ratio means that that property assessment should be $79,365 [$100,000 divided by 1.26], not $100,000. An assessment of $79,365 would mean that the annual taxes would be $1,946 [$79,365 times 24.5140 divided by 1,000] instead of the $2,451 it is under the current assessment.
Are tax savings a little over $500 a year worth filing the appeal? While there are costs involved with an appeal, such as filing, appraisal and counsel fees, even if those costs are not recovered in the first year, the savings from a lowered assessment will continue year after year.
Appeals filed this month will be heard and decided this fall, and will take effect in 2015. If you miss the August 1st deadline, you will need to wait another year, and your chance to lower your total tax bill for 2015 is missed. If you have questions about what is required to prove fair market value, how to make sure that the County’s records of your property are accurate, including tax exemption or immunity, or would like assistance with the assessment appeal process, call or email us, but do so soon so that we can get your appeal filed by the end of July.
Christina Hausner is an attorney at Russell, Krafft & Gruber, LLP in Lancaster, PA. She received her law degree from Duquesne University School of Law and practices in a variety of areas.