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With the seventh-highest property taxes in the nation, it’s not uncommon for Texans to experience a jolt of sticker shock when they receive their annual property tax appraisal notifications. Following two years of soaring home prices in the Lone Star State during the pandemic-era housing boom, 2022 home appraisals hit some residents like a bolt of lightning.
Homeowners in Austin, for example, have seen their appraisals rise by 53%, while residents in other major cities like Dallas and San Antonio have experienced 25% increases.
Fortunately, you can challenge your property's appraisal by filing a property tax protest. This administrative process begins in January, so now is the perfect time to learn about how it works and take action to lower your 2023 property tax bill.
In this blog post, we’ll fill you in on all the relevant dates you need to know and guide you through the five-step process of the residential property tax protest in Texas.
Step 1: Appraisal District Assigns Value to Your Home (January-March)
The appraisal district begins the process of determining your home's appraised value at the start of the year. This value is based on an estimation of your property's market value, taking into account its condition and potential sale price.
Step 2: You Receive Notice of Your Home’s Appraised Value (March-May)
Starting in April—and in some counties as early as March—you will receive a notice in the mail from the appraisal district that includes the value of your home and the exemptions that apply.
Step 3: Don’t Miss the Protest Deadline (May 15, 2023)
It’s important to know that May 15 is the last day to file a “Notice of Protest” to your appraisal district (or the 30th day after the notice of value was delivered, whichever is later). You can file via the form on the notice you received in late April/early May, or you can file online through your appraisal district’s website.
Step 4: Informal Meeting with Appraisal Staffer and the Appraisal Review Board (June)
After filing your "Notice of Protest," the appraisal district will schedule an informal meeting and a formal hearing with the Appraisal Review Board (ARB).
At the informal meeting, an appraisal staff will review your property value. You should provide any relevant documentation to this meeting, including information on comparable sales in your area, valuation comparisons with properties similar to yours, repair estimates, photos, and any other records that may indicate your home’s value is over-appraised.
After this review, the district may offer a reduced value, which you can accept or continue your appeal through the formal review process.
Step 5: Formal Hearing with the ARB (June-July)
If you are not satisfied with the value offered at the informal meeting, further appeal is available through a formal hearing with the Appraisal Review Board (ARB)
During the formal hearing, you provide testimony under oath and the proceeding will typically last 15-20 minutes. You will present evidence and argument supporting your belief that your home is overvalued and provide a specific value that you believe to be accurate.
The appraisal district will have the chance to rebut the evidence you presented and provide their own evidence that supports their opinion of value. Both sides are allowed to make closing statements. Finally, the ARB panel will close the testimonial part of the hearing, deliberate the evidence presented, and issue their determination and recommendation of a final value to the full Appraisal Review Board for final approval.
In the instances in which a homeowner is still not satisfied and does not want to give up the fight, further relief may be available through Binding Arbitration during which a neutral arbitrator hears and examines the facts of an appeal and makes a decision that is binding on both parties.
To request binding arbitration, a property owner must file a form requesting Binding Arbitration within 60 days of receiving the final order of the ARB’s determination of value. Depending on the level of valuation on the home, an arbitration deposit must be paid.
If the arbitrator determines that the value is closer to the owner’s opinion of value than the ARB’s determination, the property owner will be refunded the deposit less $50 for administrative costs. The appraisal district is then required to pay the arbitrator’s fees.
If the arbitrator’s assigned value is closer to the ARB’s value, the arbitrator is paid from the property owner’s deposit. The deposit amount for properties valued at $500,000 or less is $450. For properties valued at more than $500,000, the deposit is $500.
Binding Arbitration is a more affordable approach to pursuing property tax relief than filing a lawsuit in district court, which is much more cumbersome and often not cost-effective.
Conclusion
If you're looking to lower your tax burden in 2023, filing a tax protest to challenge your property's value may be the ideal solution.
As tax bills continue to rise, homeowners have the option of fighting for a lower value on their own or hiring a property tax service to file a protest on their behalf. At SWBC Ad Valorem Tax Advisors, we can help you reduce the appraised value of your home and lower your annual tax bill.
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