Should you file an appeal on your property assessment?
By Jerry Davich
JULY 21, 2015, 4:37 PM
I opened the Form 11 letter cautiously, worried that my home's adjusted assessment would be ridiculously overvalued, jacking up my property taxes.
I've heard stories from other northwest Indiana residents, especially in Porter County, of their home's assessed value skyrocketing by as much as $22,000 from last year's assessment. Could my small, humble
abode in Portage join that trend?
After hearing from a few readers with similar worries, and some confusion over these forms and figures, I contacted Porter County Assessor Jon Snyder and Porter County Auditor Vicki Urbanik. I asked
them to give me a crash course in "Property Assessment/Taxes for Dummies," with me being the biggest dummy.
I've never had a firm grasp on this topic. All I know is that these annual notices of assessed property are not tax bills, but the bills going out next year will be based on these assessed values. So I understand
some homeowners' outrage when their property value has gone through the roof and they fear their tax bill next year.
In the simplest terms, "The assessor's office forwards us the values they calculate for each parcel, and our office enters these values in our property tax system," explained Urbanik, who took office Jan. 1.
Still, most homeowners' knee-jerk question is always the same: Does a higher assessment mean higher taxes?
"It can. But not necessarily," Urbanik said. "A variety of factors determine exactly what our final tax bill will be."
"One of these factors is the tax rate for all the local government units you pay taxes to," she said. "Very generally speaking, if a taxing district's overall assessed value goes up, there is a chance the tax rate
will either go down or not climb as much as it normally would without that higher AV."
For example, Chesterton's net assessed value went from $602.7 million in 2014 to $635.8 million in 2015. And the town's tax rate fell from 96.7 cents to 94.9 cents.
"So if you own property in Chesterton, you may have seen your individual AV increase, but you paid a lower tax rate for the town government," Urbanik said.
Did this save those homeowners on their tax bill? Again, it depends on a number of factors. For example, one Chesterton home's assessed value went up by about $7,000. The total tax bill increased by about
$90, despite the lower tax rate. In this case, the higher assessed value was not offset by the lower tax rate.
In another example involving a Chesterton taxpayer, the assessed value went down by $4,000, and the total tax bill fell by about $200. The lower assessed value and lower tax rate resulted in a lower bill.
"Another factor impacting tax bills deals with how much one's individual assessment increased and how that was affected by the tax caps," Urbanik said.
If your entire property is a homestead assessed at $150,000, under the tax caps you know that your final bill cannot exceed 1 percent or $1,500 (though exceptions apply for voter-approved referendums, such
as school referendums). But if your homestead's assessed value increased to, say, $160,000, your bill's capped maximum just increased — to no more than $1,600.
Also, factor in that some final tax bills depend on whether you had any changes in your deductions and how the county's homestead credit affected your bill.
"One taxpayer came in earlier this spring and wanted to know why his tax bill increased," Urbanik said. "He had a modestly assessed home, and his AV went down. His tax rate also went down. But his bill
went up slightly."
How did that happen? First, he didn't receive as much of a homestead deduction because his home's assessed value dropped and his deduction amount also dropped. Second, the county's homestead credit rate
decreased this year so this particular taxpayer saw less of a savings from the homestead credit.
On the other side of this property value and taxing enigma, Snyder first explained that assessing is based on a "mass appraisal model" designed and approved by the state. However, the results of this model
are tailored annually by local assessors to fit each neighborhood's specific market.
"Mass appraisal is much more generic than an appraisal performed by a local appraiser because all data is considered when valuing each parcel in a designated tract or neighborhood," Snyder said.
For example, all sales are analyzed by the assessor to determine which ones are "valid" for purposes of valuation. Short sales, foreclosures, sheriff's sales, and "non-arms length" transactions are usually not
considered when valuing property.
Values in any neighborhood will fluctuate based on the annual market activity. In Porter County, the gross assessed valuation for 2014-15 was up about 3 percent from the previous year.
"This really shouldn't be much of a surprise considering the hot markets that make up Porter County," Snyder said.
In short, each parcel should have a valuation similar to its market price. (A helpful estimating tool can be found at www.in.gov/dlgf/4932.htm.)
"If this is not the case, then the model has failed, and the taxpayer should file an appeal," said Snyder, whose office is already flooded with appeals. "The more information the taxpayer provides, the better for
Taxpayers have until the end of August to file an appeal, and they can do so online at www.portercountyassessor.com.
Keep in mind that a number of factors are involved in assessing similar-looking properties, including brick exterior versus vinyl siding; whether a garage is two-door or three-door; the number of bathroom
fixtures; whether there is a large pole barn or just a small shed on the property; and the size of a deck, among others.
As for my latest assessment, it went down more than $1,000. I'm not sure if my 15-year-old home is slowly going to pot, or if it's the entire neighborhood.