 |
INTRODUCTION
As 2005 draws to a close and the town prepares to send out its actual tax bills for Fiscal Year 2006, several questions may arise from concerned taxpayers that need to be addressed. At this time of year, after the interim valuation adjustments have been made and the anticipation of increased billing, questions center on abatements and filing for relief. In any mass appraisal, errors appear that effect the value whether it is an error in measuring the property, or the inclusion of something that does not exist, or a misstatement of locational or area attributes. Massachusetts General Law allows the taxpayer a vehicle through which they can contest an assessed value on a specific parcel. The following is a description of the abatement process, when to file, and what to do to insure that an abatement
is more likely to be granted.
THE BASICS -VALUATION
Most people feel that it is the change in value that effects their taxes when in fact it is not the case. In actuality, values on homes could double, triple or quadruple and, if the overall budget for the community stayed the same, the individual taxes on each property would stay the same. It is the town’s need to raise money to provide services to the taxpayers that establishes the burden on the entire town, and the estimated market value on the individual homes that allocates that burden to the individual taxpayer.
The assessed value of a property rests strongly on two principles, that of market value and equitability.
Market value is defined as the value that a property would most likely bring in an open market, with proper exposure, a buyer and seller who are knowledgeable and operating in their own best interest, and with considerations made that are terms of cash or its equivalent. Market value is estimated by three approaches to value: sales comparison, cost and income. The sales comparison approach relies on the sales of similar properties and relates best to the valuation of residential homes and single unit commercial properties that would normally be owner occupied. The income approach relies on the conversion of market rent to an indication of value. This approach to value works best on multi-tenanted commercial and residential buildings such as 6+ unit apartment buildings and larger office and
retail buildings. The cost approach relies on the anticipated cost to build, less allocations for physical depreciation, functional obsolescence and economic obsolescence. It is most accurate when the improvements to the parcel being valued are new.
Equitability is also a strong component of municipal valuation or assessing. In order to be taxed fairly, homes must be valued in a similar fashion. For example, it would be inappropriate for a town to value an 8-room colonial on a half-acre of land at $350,000 and value a similar colonial next door for $550,000. Such disparities fly in the face of reason and tend to make taxpayers extremely upset!
WHY SHOULD A TAXPAYER FILE?
A taxpayer should file for an abatement only if he or she has a reason to file. Good reasons are: inaccurately measured improvements; additions that do not exist; amenities, such as pools and sheds, that have been removed or were never built; a lack of equitability in valuation. Bad reasons (or unacceptable reasons) for filing: not being pleased with the value estimate, being unhappy that the values have increased, displeasure with the tax rate, an inability to afford paying taxes.
INVESTIGATION IS AN IMPORTANT FIRST STEP!
If a person feels that he is being unfairly valued, he should investigate to see if there is some reason for his concern. Look at the assessed values of similar homes in the area. Comparability is extremely important if a lot is improved, such as, with a cape; for instance, the values of other similar capes in the area should be investigated. Values of ranches would be inappropriate when valuing a cape because it is impossible to know how the value of a ranch relates to the value of a cape.
Ask for a copy of your property record card and check the data on the card. If disparities exist, contact the assessing administrator and set up an appointment to have the property viewed. There are approximately 8,000 parcels in town. Each property record card has over 100 fields where data is either entered or repeated. As careful as researchers and data entry people are, mistakes are made that effect value. It is up to the taxpayer to check the accuracy of this information and file for an abatement if it is appropriate. It should be noted that not all fields effect value and that if an error is found, the accuracy of the entire card will need to be rechecked by a member of the assessor’s office.
Assessing information is available on the Town’s website, which is www.town.belmont.ma.us, or click here. The same information available on the property record card, or on the computers available to the public in the office, is on the website
Check the sales of comparable properties in the area. It is extremely important to research only sales of truly comparable homes during the period being considered. FY2006 values are based on sales that occurred during 2004. Often the sales of the filing taxpayer’s home, if it occurred during the appropriate time frame, can be used as support for a change in value. It must be an arms length transaction (not between relatives, between divisions of the same corporation, or a distressed sale) and reflect normal market tendencies. It is important to remember that a party filing for an abatement on a property that has sold recently for an amount in excess of the present assessment will have an extraordinarily hard time convincing the Board of Assessors that the property is unfairly valued.
FILING FOR AN ABATEMENT - DEADLINE
For FY2006, abatement requests are due by Wednesday, February 1, 2006, 4:00 p.m. All abatements filed after this date will be denied without consideration.
FILING THE FORM
The assessing office has copies of abatement applications available upon request. Abatement forms can be mailed out through a telephone request or a request made in writing. The correct filing form is STATE TAX FORM 128, REVISED 12/2000, Titled: APPLICATION FOR ABATEMENT OF REAL/PERSONAL PROPERTY TAX. This is a four-page form and must be filled out completely. The form is self-explanatory. To retrieve an abatement application form, click here. Always supply your request and your opinion of the market value of your property with the data that supports your opinion. The burden of proof for an abatement is on the taxpayer. The more support supplied to the assessing department with the application, the more likely that an application will be considered. Abatement requests that are filled out without the support are often denied with little or no consideration. Supporting information does not have to be filed with an abatement application, but if it is not, the application should contain
a statement that supporting data will be supplied within a specific time frame and that support should be submitted no later than 30 days after the initial filing of the application.
TIME FRAME(S)
All applications for abatement must be acted upon within three months (12 weeks) after the date that the application is filed, unless the Board of Assessors and the taxpayer agree to an extension in writing. All requests that are not acted upon within three months and are not extended are “deemed denied.” All applications that are deemed denied will receive written notification within ten days of being deemed denied. Deemed denied is another way of saying assumed to be denied without comment. It is extremely important for a person filing for an abatement to note the time when an abatement is filed and contact the assessors office if notification of a decision on
the abatement is not received within the three month (12 weeks) time frame from the date of filing.
If the Board of Assessors feels that more information is needed to process that abatement request, under Clause 61A in Chapter 59, the Board has the right to make that request in writing to the taxpayer. All requests under 61A must be responded to within thirty days. A lack of a timely response can compromise the application or any subsequent rights to appeal.
THE RIGHT TO APPEAL
If a request is denied, or if the taxpayer is not satisfied with the abatement granted, taxpayers can appeal to the Appellate Tax Board. All filings must be made within three months of the date of denial of the abatement application or notification of deemed denial. The Appellate Tax Board is operated like a court of law with a hearing officer and sworn testimony. Taxpayers (the appellants) must present a convincing case before the hearing officer with the support of their value conclusions.
CONCLUSION
Abatements afford taxpayers the ability to voice their concerns regarding the value of their property, if they have a strong conviction that they are being unfairly burdened and can adequately prove their position. The abatement process is necessary to insure that homes are being valued fairly and that no one is being unfairly taxed. It is the intention of the Board of Assessors to listen to and resolve all reasonable requests that are well supported and documented.
The Board of Assessors
Angelo A. Borelli, CMA, Chairman
Charles R. Laverty, Jr., CAE
Robert P. Reardon, CAE
| |
