Property Tax Assessment Appeals & Deadlines (including Shelby County Property Tax Appeals)
What Is a Property Tax Appeal?
A property tax appeal is not an appeal of the tax. It is actually an appeal of the underlying assessment value that is used to calculate the tax owed on a parcel. The assessed value is usually a percentage of the Fair Market Value (FMV) of a property. The FMV is the amount that a willing buyer and seller would exchange property for in an arms length transaction. The assessed value is determined by the Assessor of Property and that value is used by the Trustee or taxing authority as a foundation for the tax bill. The taxing authority uses the assessment, and the tax levy millage (determined by the legislative body each year), and multiplies the assessment and the levy to determine the tax bill due. Thus, when we submit a property tax appeal, we are not actually appealing the tax per se, we are appealing the underlying value that is a major component in determining the tax. We can not appeal the tax levy, but we can appeal the property tax assessment. And we do! The appeal is filed by us with the local county Board of Equalization.
In Tennessee, the County Assessor is responsible for assessing all of the property, of every kind and nature, in the county and for certifying the value to the tax rolls by April 20 of each year. The “certified roll” is then provided to the County Trustee, who takes the approved budget, divides the amount of money needed by the total of all assessments, and determines the levy for each millage assessed. The levy is then multiplied by the assessment for each individual tax parcel and a tax bill is created.
A tax bill is sent during the billing period, which, for counties, is October through February. County taxes must be paid by the last day of February, as they are delinquent on March 1. Interest & penalties of 18 % accrue annually on delinquent taxes in Tennessee.
Assessed property tax values are made available to owners after they are certified, or after April 20. Values are often sent by postcard from the Assessor to the mailing address that the Assessor has on record, obtained either from the Register of Deeds, or from an update by the owner. Owners can also look on line at their local county assessor website.
Property tax assessment appeals must be filed between May 1 and June 30 of each year. (We ask our clients to submit Representation Forms to us no later than June 20. After June 20, we will accept Representation Forms but only upon written confirmation). See attached Representation Form.
Real Property is assessed by the County Assessor in which the property sits. State law requires that a county-wide reappraisal be conducted every four years by the County Assessor. 2013 is a reappraisal year. If that value is not contested, it remains the value used to determine taxation for the entire four years, (unless the Assessor does a voluntary adjustment). Although some owners may just appeal their tax assessment in the reappraisal year, most of our clients sign a Representation Form allowing us to appeal their tax assessment for all years between re-appraisals as well. This allows us to keep contesting the values if the market drops. Without filing an annual appeal, the property value will usually remain at the assessment from the prior year (unless the Assessor does a voluntary adjustment).
Business Personal Property Assessments are a self reporting system. Schedules are mailed out to owners in February of each year and must be reviewed, signed, dated and returned to the Assessor by March 1. If no schedule is returned or submitted, then a “forced assessment” is made against the taxpayer. Business Personal Property Assessments, including “Forced Assessments” can be appealed and the appeal period is May 1 through June 30 of each year. A completed, signed and dated schedule must be attached to a Business Personal Property Appeal, in addition to the Appeal form.
State Assessed Property Assessments are provided by the Director of State Assessed Property in Nashville. Those values are provided in January of each year, for the prior tax year. State Assessed Properties include planes, trucks, and boats, and pipelines. The value is apportioned between according to the values determined to be appropriate, and relevant to each county. The income, cost and market approaches are used, and a value is determined. These values can be contested as well. New values for the prior year are made available in January, and so an adjusted bill is sent out in January, changing the tax amount for the prior tax year. These taxes are usually corporation taxes, as the property is assessed and owes a tax due to it’s income producing nature.
Farmlands and Greenbelt are assessed at a reduced rate, and a tax is levied against this classification during the tax season as well.
All residential, commercial, industrial, farmland, greenbelt and business personal property, including state assessed properties, are included in the annual certified tax rolls.
A PILOT or Payment-in-lieu-of-Taxes, is a contract amount that is paid instead of the tax amount that would be owed without the contract. These contracts are made with the governing body of the taxing entity. These PILOT taxes are due during the tax season and are late, and may be subject to cancellation if not paid timely.
CBID, or Central Business Improvement Districts, or Special Assessments, are a levy against properties in a development district. These obligations are funds earmarked for a special fund, which has a stated purpose, like development, or sewers, or sidewalks, and they are an additional levy on a defined geographical district. The levy is set by the governing body at the creation of the special assessment, and these assessments do not usually change. Special assessments are at a set, usually, unchanging rate. The underlying property assessments, however, do change over time, so appealing the underlying property value can result in a lowering of the special assessment levy owed. In conclusion, appealing your property value in a special assessment district can lower your obligation. Note: Special assessments are not considered a tax, but for taxpayers, it seems like one. The reason special assessments are not a tax is because the special assessment goes to a special fund, and those funds can only be used to improve that district. Special assessment funds are never co-mingled with tax funds. They are separate. This is the distinction: Taxes are a charge to the land. A cost. Special assessments are to improve the land. They are presumed a benefit.
What do we do for our clients?
- We complete the appeal forms for all of our clients.
- We file the appeal forms for all of our clients by the appeal deadline.
- We contest the assessed property values for all of our clients.
- We determine fair taxation values and attempt to achieve these goal driven reductions for our clients.
- We appear at the first level appeal hearings and/or work directly with the assessor representative or hearing officer for our clients.
- We will file administrative appeals through all appeal levels and carry appeals to Chancery as needed (for additional fees as discussed and approved by Client if appealing to upper levels is appropriate).
- We use our expertise and best efforts to get results.
- We charge a fee of 1/3 of the tax savings.
- If we do not reduce your taxes, we do not charge you a fee!
- This is a WIN~WIN scenario.
- Not all tax representatives are lawyers. A lawyer will represent your case at hearing. Gwenthian Hewitt began her legal career in 1995, and since then has been either defending/asserting taxation and/or appealing assessment taxation values. She has been deemed an expert in her field due to this extensive, day in day out experience.
- Experienced lawyers provide better results.
Types of properties on which we appeal taxes
We appeal assessments on ALL TYPES OF PROPERTIES.
Obviously, Commercial and Industrial properties carry the heavier weight of taxation, as in Tennessee, their assessment is at 40% of the Fair Market Value. This means we appeal apartments, office buildings, gas stations, stores, restaurants, dry cleaners, car shops, racetracks, etc.
Residential properties carry a 25% assessment rate. We have appealed thousands of residential properties, with positive results.
Personal Property used in business, including State Assessed Property, carries a 30% assessment rate. Since Business Personal Property is a self reporting system, often taxpayers are comfortable with the assessed value they are initially awarded. But, if a taxpayer fails to submit his/her schedules timely, and a “forced assessment” results, we recommend appealing a “forced assessment” unless the new assessment is fair.
- Our fee is 1/3 of the tax savings.
- If we do not reduce your taxes, then we do not get paid.
- We file the appeals at no cost to you.
Experienced lawyers provide better results.
Be careful ~ not all appeal representatives are lawyers. With the Hewitt Law Firm, only lawyers will appear on your behalf.
How do you pay us?
We take cash, check or money order. Most of our clients pay by check. (Sorry, we do not yet take credit cards.)
You pay us 1/3 of your total tax savings for the year appealed.
We expect payment within 30 days of our hearing results.
When do you pay us?
After your taxes are reduced. We require payment within 30 days of the reduction as reflected on the tax bill and/or our e-bill. (We e-bill (send you a bill via email) unless otherwise arranged or requested.)
We value our relationship with you. We want to appeal your taxes every year. We want to get you BETTER results every year. We have clients who can provide testimonials. Our clients are happy. We only get paid if we save you money. We enjoy getting results for our clients, and we are incentivized to get you the best results possible. (Caveat: the laws promote fair taxation, but not exact taxation. We can do our best, but our results are subject to the fairness standard).
Property Tax Appeals ~ Client Duties
What do you need to do?
We require you to complete our Representation Form.
We ask that you submit the signed Representation Form by June 25. (On a case by case basis we will accept forms at the last minute, but appeals must be filed with the Board of Equalization by 4 pm on June 30.)
Provide us supporting data that you have, if you have any.
We require payment within 30 days of our bill or your notice of reduction. Review and Approve our Contract. If you submit a signed Representation Form, it incorporates our Contract, and signing of the Form binds you to the Contract that appears on this site.
When do you pay your taxes?
In Tennessee, county taxes are usually levied in early fall, and the tax payment period is from October 1 through February 28. County Taxes are late on March 1 (of the following calendar year).
Municipal taxes are due depending on the City. City of Memphis taxes are levied in late June, billed in July and must be paid by August 31. They are late on September 1 (of the same calendar year).
Late Payments Accrue Charges
Taxes accrue 12% interest per annum once they are delinquent and they also accrue 6% penalty per annum. In other words, taxes run at 18% interest and penalty annually, plus prosecution costs when applicable, if they are delinquent.
When should you pay our taxes that are under appeal?
Tennessee law requires that you pay your “undisputed portion” at the time the taxes are due to avoid penalty and interest accruing.
County Due Date: February 28+ (of the next calendar year)
City Due Date: August 31* (of the same calendar year)
+Because Tennessee was a farming state, taxes are due after the crops were harvested, in the fall, and must be paid no later than the end of February.
*See your City Bill for due date. Some city taxes are due at the same time county taxes are due.
What should we pay when our taxes are under appeal?
You have a choice, you can pay the entire amount owed, and later request a refund
You can pay your “Undisputed Amount”.
What is my “undisputed amount” and how can i figure it?
You can use this formula:
Proposed Value x Weight x Levy = Undisputed Tax
Proposed Value = the value you/we believe (using comparable sales or other data) that the property is worth
- Weight: Determined by Classification or use:
- .25 is the weight used for Residential
- .40 is the weight used for Commercial/Industrial
- .30 is the weight used for Business Personal Property
- Levy: Tax levy millage. See levy amount on the tax bill sent to you by the city or county.
- Undisputed Tax: the amount of tax you admit, in fairness, that you owe. Your tax portion for that particular tax parcel. (Note: each tax parcel portion must be determined separately.)
NOTE: the Shelby County Assessor has a calculator for you to use to determine your taxes on their webpage. Go to: www.Assessor.shelby.tn.us and find it in the left column. It is much easier to use it than to do the math yourself!
How do i pay my undisputed tax when my taxes are under appeal?
You must do the following:
- Determine the undisputed portion.
- Pay that full amount to the taxing entity by the tax deadline. Do not be late.
- Write “Paid Under Protest” on your payment.
- Identify that parcel(s) being paid, and mark that you are paying your “Undisputed Portion”.
- Keep a copy of the paperwork showing that it was paid under protest. Note: if you do not submit this payment timely, interest and penalties will accrue on the full amount of taxes due.
Because appeal hearings are usually completed by late November, (unless in a reappraisal year), the county tax bill will usually be updated and corrected by the time those taxes are due (February 28). If you desire to pay your taxes by December 31 (for IRS tax reasons), you can either pay the full amount and later request a refund or pay the undisputed portion (as described above). If your appeal is not heard before your taxes are due, then pay either your full amount due or your undisputed portion, (and be sure to follow all of the steps for submitting your undisputed portion, including saving a copy of your paperwork!)
IF YOU PAY THE UNDISPUTED PORTION BE SURE TO WRITE “PAID UNDER PROTEST” ON YOUR CHECK.
[Note: we usually submit all of our accounts that are under protest to both the city and county officials so that they know your taxes are under appeal with us.]
Because appeal hearings usually begin AFTER the city taxes are due, we recommend that our clients pay their full/entire city taxes that were billed on time. Experience has taught us that it is easier to pay the city in full, and then request a refund later.
However, if your have a high value property, you may want to pay only the “undisputed portion” of taxes, which is the amount you agree you would owe, if, upon hearing, the value was lowered to the amount you/we assert (on appeal) it is worth. If you “short pay” due to the fact that the taxes are under appeal, be sure to write “Paid Under Protest” on your check, and identify the parcel number. See section: HOW DO I PAY MY UNDISPUTED TAX WHEN MY TAXES ARE UNDER APPEAL? above.
Late Fees and Interest & Penalties
If you do not pay your taxes or the undisputed taxes on time, you will be charged interest & penalty at 18% per annum. These charges accrue as a lump sum on the first day of each month and at a rate of 1.5% per month on the first of every month. There is no arguing with these charges or prosecution costs or attorney fees if the tax obligation goes to lawsuit. Eventually, if taxes remain unpaid, the property will be assigned to Tax Sale. If your property has been sold by Tax Sale within the last year, then inquire about our help with Redemption. There is a one year right to Redeem, under state law, but redemption requires that you pay all taxes and charges that were owed under the tax suit.
After we are successful in reducing your taxes, an Adjusted Bill is sent to you WITHIN 60 DAYS OF THE ADJUSTMENT by the taxing authority. NOTE: YOU CAN ALSO LOOK ON LINE AND PAY ON LINE.
If you paid your undisputed portion on time, then you should not be subject to interest, penalties or charges. If charges appear on your bill you should contact the taxing entity and if necessary show them your paperwork that you submitted the payment under protest and that it was paid when the taxes were due, not delinquent. The taxing authority should adjust the bill and correct their mistake. Do not argue with the taxing authority employees. If you can not resolve your dispute amicably, then you should contact your attorney to assist. We do request that you take the above steps before contacting us though, as we appeal thousands of properties a year, and our expertise is focused on getting you results and helping you with your taxation. Ministerial or administrative errors happen, but those are not our issue, usually. We always want things to go smoothly and we are here to help if you need us. But usually, these small matters can be worked through so long as you have your paperwork!
If you paid your undisputed taxes late, you can expect to pay interest and penalties and any other charges due, on the tax amount you owed that you did not pay timely.
What else do you need to do?
Be excited about your tax savings. Pay us our 1/3 fee. Tell your friends about us, please. We appreciate referrals! Plus, we like to help people. That’s why we became attorneys!