April is the month to be thinking about property taxes in Minnesota.  Each spring, property owners are notified of their proposed property taxes payable the following year.  This property tax assessment is determined, in part, by the classification of the property and the estimated market value of the property, which are calculated by the county assessor.  If you dispute the classification or valuation of a property, the property tax assessment can be appealed.

Property tax appeals for taxes payable in 2014 are due by April 30, 2014.  April is also the month when the proposed value and taxes payable for 2015 are established.  During April, the Local and County Boards of Appeal and Equalization will consider informal requests to lower the tax assessed value of properties for taxes payable in 2015.  Assessors will also consider informal requests, substantiated by market evaluations and/or appraisals, during this time.

Who can appeal property tax valuations?

Anyone with right, title, or interest in the real property, including a lien, may appeal or challenge the property tax assessment.  Therefore, a lender who holds a mortgage against real property does not need to wait until the property is bank owned before filing a tax appeal.

What is the basis for a property tax appeal?

The most common reason for a property tax appeal is based on a dispute over the valuation of the property.  County assessors must determine each property’s market value as of the assessment date of each year.  To accomplish this, county assessors use historical sales to make these valuations.  However, county assessors also review other various factors in determining a property’s valuation, such as market condition, square footage, and physical features.

Generally, the market value of a property is the price a willing and able buyer would pay the seller for the property in an arm’s length transaction.  In addition, a property must be assessed at market value that is uniform with similar properties. Therefore, if you feel that a property you have an interest in, or lien against, is valued at a greater amount than it would sell for or if the property is valued higher than other similar properties, the property may be overvalued.

Do the property taxes need to be current to appeal?

Yes, the tax court will dismiss any appeal where the tax payments are delinquent.  This includes paying the challenged property taxes by the May 15 and October 15 deadlines, even if an appeal is pending.  Under certain circumstances, tax payments for the year in which the appeal is filed may be partially paid.

What should I do?

Most counties have websites where you can view the tax value for real properties for taxes payable in 2014, as well as the proposed value for taxes payable in 2015. If you feel that properties you have an interest in, or lien against, are valued in an amount greater than their true market value, Anastasi Jellum, P.A. can help you determine an appropriate course of action.