Posts Categorized: Property Taxes

What is a Property Tax Agent?

You Need Someone in Your Corner Who Will Fight For You.

A Tax Agent is… 

  1. Licensed by the State

A Texas property tax agent is an individual licensed in Texas to represent taxpayers in the valuation appeal process. There are education requirements and certification exams proving a base level of competency in Texas property tax law before someone can become licensed.  Once licensed, continuing education requirements ensure agents are staying up-to-date on Texas law and ethics. When evaluating an agent, first check to see that they are licensed and legally allowed to represent you.

  1. Your Advocate 

Tax agents are meant to be your advocate and represent your best interests.  They are an extension of you throughout the appeal process. Their goal is to reduce your property tax burden while preserving your relationship with the county. Your agent should communicate with you proactively and keep you in the loop. Unless you specifically state it, they should not be accepting valuations or settlements without your knowledge. 

  1. A Representative Who Works For You

Your tax agent should be working for you, not working around you.  They should not file appeals on your behalf without your permission. Occasionally, you may find an agent who is overly aggressive and ignores your instructions. They may even threaten to drop your appeal if you don’t do what they say. These agents are acting beyond their authority, and you should review your rights to hire a more respectful agent. If you encounter a rude agent, you should run in the other direction!  Agents like this run the risk of causing a rift between you and the county–and that could damage your future appeals. There are too many good agents out there; you don’t need to settle for poor representation.

An Extension of you

Ultimately, a tax agent should be an extension of you, decreasing your stress and fighting for reductions. They should handle the entire appeal process and keep you in the loop, while minimizing the burden on you. Hiring the right property tax agent will bring results to you and your property that can make a meaningful impact to your bottom line.

See How Wayfinder Can Help

Schedule a Call

How do I Calculate My Texas Property Taxes?

Calculating Your Property Taxes in 3 Simple Steps

Step 1: Find your property value. This can be found on your Notice of Value or on the central appraisal district website where your property is located. If you don’t know your property account/parcel number, you can often find it by searching by address or owner name.  

Step 2: Determine the tax rates that apply to your property. In many instances, the tax rates can be found where you find your property value. Be sure to locate all applicable tax rates, which may include the Independent School District (ISD), county, city, hospital, community colleges, etc. A good check is to review the previous year’s bill to ensure you have located all the taxing jurisdictions.    

Step 3: Multiply the property value by the total tax rate. Texas property taxes are calculated on 100% of the market value of the property.  If the total value is $10,000,000 and the total tax rate is 2.5%, then the tax bill would be $10,000,000 x .025 = $250,000.

That wasn’t so hard, was it? The tax system can seem intimidating at first, but a few good tips from an expert will give you a good handle on the terminology and formulas used in your valuation, driving you to ask the right questions and know when you can go it alone and when it’s time to reach out for assistance.

Why Does it Matter?

When you know how to calculate your own estimates, you no longer need to take your tax agent or the taxing jurisdictions at their word. You can verify that your tax bill is correct, and you can calculate the tax savings you are receiving. You will have more peace of mind knowing you are not dependent on someone else’s work.    

See How Wayfinder Can Help

Schedule a Call

What Happens at the Appraisal Review Board (ARB)

 Taxpayers and the Appraisal Review Board

Advice From an Expert

What is an Appraisal Review Board? 

An Appraisal Review Board, or ARB, is a group of citizens authorized to resolve disputes between taxpayers and the appraisal district. Texas Tax Code §Section 6.41 establishes the process for appointing the members of a local ARB. The goal of the ARB is to settle valuation disputes between the appraisal district and the property owner. If you file an appeal of your proposed value and cannot come to an informal settlement with the appraisal district, you will be given an ARB hearing date. Although the guidelines used in the ARB manual are published by the Texas Comptroller’s office, it is important to note that the ARB is independent of the appraisal districts.

What Should Taxpayers Expect?

Now that we understand the ARB’s purpose, what should a taxpayer expect when they find themselves arguing a case before the board? At an ARB hearing, both the appraisal district and the taxpayer will have an opportunity to present their case, with the taxpayer given extra time to rebut the appraisal district’s evidence. However, ARB hearings are rather informal, and a board can take its time asking both sides plenty of questions concerning submitted evidence. Taxpayers should expect to have their evidence scrutinized and doubted when they present their case. Moreover, taxpayers need to understand that the appraisal district will be at the hearing presenting their own evidence to the board and arguing against the taxpayer’s positions and opinions. This process can be daunting and intimidating to say the least. However, there are a few things taxpayers can do to increase their chances of success at an ARB hearing.

  1. Prepare Evidence

Preparing thorough, relevant evidence to your case is the best way to position your appeal for a reduction to taxable value. Comb through the market and find comparables that support your value, or do a comprehensive analysis of the income your property can generate in the current market. Whatever evidence you find that supports your position, make sure to organize it clearly in the packet that you will submit to the ARB. The easier it is to understand and navigate, the better your chances of persuading the board.

  1. Review the Appraisal District’s Evidence

As a taxpayer, you are entitled to all evidence the appraisal district used in setting your proposed value and plans to submit before an ARB. Request this evidence well in advance of your hearing and review it because you may find errors that need to be addressed. Raise any issues before the board.

  1. Be Respectful

I have seen many agents and taxpayers get upset before a board for many different reasons, but do not let this happen to you. Having an emotional response to your protest is ok, but remember that the appraisal district and ARB members are all just individuals doing their jobs. Being disrespectful or causing a scene will only serve to damage your reputation and put future appeals/hearings in jeopardy. 

Evidence

So really…that’s it! You can expect to have a ruling on your case at the conclusion of your hearing, and know that if you are upset with the ARB’s ruling, there is always an opportunity to further pursue your appeal through the court system. If you have any questions concerning your appeal, hearing, or ARB ruling, please reach out to our multifamily specialists.

See How Wayfinder Can Help

Schedule a Call

Why Would You Pay a Higher Percentage?

The Cheapest Tax Agent Usually Costs the Most Money

Are You Getting What You Paid For?

Comparing Agents

Searching for the right Texas tax agent can be overwhelming.  There are so many options, and everyone seems to have something unique.  The most common criteria used to compare agents is the contingency fee they charge, and agents are typically paid based on the tax savings they achieve for their client.  The major benefit to contingency is that the agent carries the risk and the client always comes out ahead by pocketing the difference from the original taxes less the agent’s fee. 

Lower Fee or Better Results?

The property owner’s dilemma is whether to hire the agent with the lowest fee or the one with the best results.  If Agent A charges 30% and Agent B charges 20%, it is logical that the owner would see the net 80% as a better deal.  Unfortunately, experience shows that the cheapest agent usually is the most expensive.  

Low cost service usually indicates: 

  1. You are just another volume client
  2. Agents are typically overburdened and can’t provide you with specialized service
  3. Agents don’t have the time or the drive to visit your property and gain critical first-hand knowledge

On the other hand, agents who specialize may charge a higher contingency fee, but some of the benefits are they:

  1. Have time to know your properties individually
  2. Perform annual site-visits to help them see the property over time
  3. Perform deeper market research to help them achieve greater tax savings

Comparing Results

To illustrate the difference, let’s look at some real-life 2020 multifamily examples (with names redacted) in Midland, TX: 

  Agent A – 30%   Agent B – 20%
Property #1   #2
Noticed Value $52,074,060   $62,175,000
Final Value $31,000,000   $62,175,000
Tax Savings $359,569    $0 
Net to Client $251,698    $0 

 

Agent B did not achieve any tax savings for their client.  The fact that their fee was lower did nothing to help their client lower their property taxes.  However, Agent A’s expertise and focus produced results that put money back into the client’s pocket.  Remember, if you aren’t paying your tax agent, then they aren’t saving you money.  The age-old adage rings true, you get what you pay for.  The cheapest agent usually costs you the most in lost tax savings.       

See How Wayfinder Can Help

Schedule a Call 

Suing After Deadline

Everyone makes mistakes, and sometimes people miss deadlines. We’re all human. But if you are a multifamily property owner in Texas who has missed the deadline to file a protest of value with your local appraisal district, there may be little hope for suing in court. 

In Texas, deadlines are everything and there are consequences to missing them. The Texas Tax Code requires taxpayers to “exhaust their administrative remedies” before they are able to file a property valuation appeal to court. In layman’s terms, this means you cannot file a lawsuit against your taxing county unless you have attempted to lower your property’s value through their administrative appeal process. This creates big issues for owners who have missed their appeal date but feel their values are unjustifiably high. Most will be stuck with this value. However, certain factors could be in play that may just save a few owners.

Correcting Errors on the Roll

As stated in a previous article, there is hope for property owners who have missed their deadlines and can meet specific requirements. Section §25.25 of the Texas Tax Code allows a taxpayer to correct certain errors that can result in lowered taxable values regardless of regular appeal deadlines. These appeals can be filed all year round. While these protests do not allow taxpayers to skip the administrative appeal process and go to court directly, they do give owners the opportunity to again “exhaust their administrative remedies”.If there is an unfavorable result after following proper procedure (an appeal and resulting Appraisal Review Board), the taxpayer may then file a lawsuit against the taxing jurisdiction.

Wayfinder’s Guidance

Missing an appeal deadline can impact a multifamily property owner’s bottom line terribly, as well as the communities they serve. As an owner in Texas, you need a strong ally that can help guide you through this significant time and yield more tax savings.

See How Wayfinder Can Help

Schedule a Call

10 Points You Should Use to Evaluate Your Agent Today

Has Your Agent Drifted?

Despite our best intentions, it is human nature to drift over time.  We may start a new fitness routine, but after a few weeks we slowly stop going to the gym.  Some of us may commit to eating healthier, but we quickly become bored with broccoli and slide back into bad eating habits (fried chicken).  Those who are conscious of this effect constantly check themselves to get back on track.  Property tax agents are no different.  When a tax agent wants your business, they will position themselves with all they can and will do for you.  At first, you are the apple of their eye and will be treated like a VIP.  Over time, drift begins to creep in, and you become just another number in their client pool.  If you are not careful-and diligently holding them accountable-it will likely begin to be reflected in your tax savings.  

Hold Your Agent Accountable

The Property Tax Agent Checklist is a free tool that allows you to rate your agent in 10 areas that impact you directly.  They are:

  1. Frequency of updates
  2. Ease of communication
  3. Communication when there are problems
  4. Expertise in property taxes
  5. Requests for information 
  6. Mentality for problem solving 
  7. Investment in your success
  8. Capacity to meet your needs
  9. Commitment to physical site visits
  10. Current on market research

The score your agent earns from your evaluation will help you know if you should keep your agent or seek better representation.  Choosing the right agent for you can mean a huge impact to your bottom line.  Choosing a tax agent once and then continuing to use them simply to keep the status quo is the perfect storm to let drift set in.  The phrase “set it and forget it” is for crockpots, not for tax agent representation.  It allows agents to become complacent, and your results suffer.  As Joyce Carol Oates said, “The great menace to the life of an industry is industrial self-complacency.”  

Trust, but Verify

Your agent should focus on your best interests, but drift can cause them to go astray.  Use the Property Tax Agent Checklist annually to confirm that your agent is giving you the best representation.  Where there are correctable shortcomings, bring them up and hold your agent accountable to make the necessary changes.  You deserve the best agent to help you and your company reduce your Texas multifamily property taxes each year.

DOWNLOAD NOW

How Does The Property Tax System Work?

Property Tax Basics

Each year, multifamily properties receive a valuation notice and later, a property tax bill.  Property taxes are used to fund local schools, city and county governments, and other local projects.  Since Texas does not allow income tax, property taxes become extremely important for funding the local government.  

Every county has a Central Appraisal District and its responsibility is to determine the market value of each property in its respective county.  To accomplish this goal, they must use methods of mass appraisal and make many assumptions about properties as a group.   

The Central Appraisal District does not determine or tax your property.  They don’t even set the tax rates.  The local taxing units set the rates and collect the taxes.      

Inaccurate Valuations

As you can imagine, a process that makes assumptions for large groups of properties leaves a lot of room for mistakes.  For your Texas multifamily property, you should never assume that your property has been valued correctly.  The valuation should be reviewed within the 30-day deadline, giving you time to appeal it.  For established multifamily properties, they are most often valued on an income approach.  The income approach looks at the net income and a return rate in deciding what a potential investor would pay for the property.  Using market rents and market expenses produces a market valuation, known as Fee Simple.  Using contracted rents and actual expenses produces a valuation known as Leased Fee.  The goal in Texas is to determine the Fee Simple valuation of your property.   

Controlling Your Property Taxes

When you consider all the annual expenses at a multifamily property, property taxes are the largest, typically making up 33% of total expenses per unit in garden apartments and 39% of total expenses per unit in mid & high-rise apartments according to the National Apartment Association 2020 Survey of Operating Income and Expenses.  

Cost cutting measures can easily be swallowed up by increasing property taxes.  Fortunately, you do have options to combat property tax increases.  If you feel your property is overvalued for tax purposes, you can file a protest with the Appraisal Review Board in the county where your property is located.  During the process, you will need to provide evidence showing why your valuation is excessive.  Remember: this is an argument about the valuation being too high, not the property taxes.  Stating that your taxes are too high will not secure a reduction to the noticed value.  If the protest is determined in your favor and your valuation is reduced, this will have a direct impact on your property tax expense.  Paying close attention to property taxes can have a significant impact to your bottom line.

Don’t Ignore Your Valuation

It is so easy to get caught up in other responsibilities and forget the importance of the one little piece of paper stating your property value and appeal deadline.  Yet, that paper can potentially be one of the most significant ways to reduce your expenses and increase your profitability.  In the rush of everything else, don’t forget to look at your property taxes.  If you are overwhelmed by all you have to do, property tax appeals can be taken off your plate by giving it to a multifamily property tax specialist.  Done right, tax agents should expand your capacity while eliminating your stress. 

See How Wayfinder Can Help

Deadlines are Passing, but There is Still Hope for Tax Relief

It is now the middle of May, and notices of value for most Texas counties have been out for several weeks. The time for multifamily property owners to decide whether they should appeal their noticed value has come (and may have passed in some jurisdictions). Under most circumstances, Texas law requires property owners wishing to file a protest of their noticed value to file a written protest by May 15th or 30 days after the delivery of the notice, whichever comes later, as spelled out in section §41.44(a) of the Texas Tax Code.

However, it is common for property owners to miss this deadline, especially following the eventful year that was 2020 and the Artic freeze of 2021. For those that have made this mistake, there is still hope to reduce your taxable value.

Texas Loves its Taxpayers

As stated in previous articles, Texas is pro-taxpayer. They care about their citizens’ rights and offer them numerous avenues for tax relief. Taxable property values are no different. For property owners who missed the deadline to appeal their value, there is still a route for getting a reduction. Texas Tax Code §25.25 provides a taxpayer the opportunity to force a “Correction of Appraisal Roll”. This can be done by proving one of the following:

  • There has been a significant error on valuing the property
  • The appraised value exceeds one-third the correct value

The law is unclear what defines an “error” in this context, but some general examples are:

  • Incorrect square footage of a building
  • Calculation errors
  • Boundary/taxing power issues 

These have been some acceptable arguments in reducing values under Texas Tax Code  §25.25. The Texas Comptroller’s website has a form you can fill out and file if you believe you can meet the above requirements.

You are Not Alone

While a section §25.25 protest is the most common method for reducing values after a deadline passes, there are still several other options for taxpayers with unique circumstances surrounding their notices and properties. If you are a multifamily property owner and your deadline for filing an appeal has passed, do not throw in the towel just yet! Contact a multifamily property tax expert today and learn your rights as a Texas taxpayer. 

See How Wayfinder Can Help

Aren’t All Property Tax Agents the Same?

A GENERALIST CAN’T DO WHAT A SPECIALIST CAN

It is common understanding that not all physicians are created equally.  Primary care physicians are wonderful at general care and can help with many problems, but a patient would be ill-advised to ask them to perform the specialized care of heart surgery.  In medicine, it has long been expected that doctors specialize in order to learn the complexities of a specific area of the body so they can give the best care. Currently, there are over 159 specialties and subspecialties listed by the American Board of Medical Specialties.   

ALL PROPERTY TAX AGENTS ARE CREATED EQUALLY

That is a common misunderstanding.  For too long in the property tax world, companies have been told that property tax agents are all the same and can handle any property type in any market.  This is not true.  Properties and markets are very different.  The belief that all are the same has resulted in many property owners receiving poor representation and care.  Specialization has become more necessary with the advanced technologies and information available in the world.  Tax agents who specialize in markets and property types are much better prepared to reduce property tax burdens than tax generalists.  Just as the trained eye of the heart surgeon sees issues, conditions, and solutions specific to the heart, the specialized multifamily property tax agent understands issues unique to your property type. Wayfinder Tax Relief is the only firm specializing in multifamily property tax in the state of Texas.

SPECIALISTS GIVE BETTER CARE

Medical specialists spend nearly all their time within their specific field of practice and come to know the details of their expertise at a much deeper level.  Understanding the details allows for better care and more accurate work.  Tax agents who try to be a “jack-of-all-trades, masters of none” are usually overburdened with too many properties, too many different industries, and a lack of time necessary to give quality attention to each appeal. That is the opposite of what you want when it comes to getting reductions and filing protests.  

Tax agents who specialize give more time to each appeal, have first-hand knowledge of the property, and even do additional research into surrounding properties to ensure they present the best, most substantiated case for their client.  The end result of this specialization is the best possible outcome for the client.

GETTING THE BEST RESULTS

Specialization in markets and property types separates great tax agents from the rest of the tax agent pool.  If you need heart surgery, go to a heart surgeon;  if you want the best representation for your multifamily property, go to Wayfinder. The results will speak for themselves.

See How Wayfinder Can Help

Not In Love With Your 2021 Property Valuation?

Here’s How to Appeal Your Valuation 

As we enter the late second quarter of 2021, local taxing jurisdictions within Texas are sending Notice of Values to property owners. These values are instrumental in the property tax cycle because they are multiplied by local tax rates to establish a property owner’s taxes. Therefore, a higher value generally means higher taxes. These values are set by local government offices called Central Appraisal Districts that provide taxpayers with a proposed value and a deadline to appeal this value. All across Texas, property owners are now weighing their appeal options as property values are jumping, according to ABC 25. Appealing this value may seem intimidating, but anyone can start the appeal process in three simple steps.

Steps to Appeal Your Valuation

Step 1 – Obtain a Form 50-132 from the Texas Comptroller’s office. The title of the form is Property Owner’s Notice of Protest and can be found here

Step 2 – Follow the instructions on the form and fill it out completely. If your appeal is not settled with the Appraisal District and you need to attend a hearing before an Appraisal Review Board, you must decide whether to attend the hearing via phone/computer, in person, or simply submit evidence on the record. Remember, if you wish to file an appeal on multiple properties, you need to fill out and file multiple forms

Step 3 – File the protest with the appropriate Appraisal District. Your appeal is with the appraisal district where the property is located, not the Comptroller’s office. For example, if you have property located within Ector county, you need to file your protest(s) with the Ector County Appraisal District. However, the Texas Comptroller’s office does have a directory for counties to assist taxpayers with proper filing of protests. 

Additionally, you must file this protest on or before the listed deadline date on your Notice of Value form you received from the appraisal district.  More and more counties are moving toward online/paperless filing of protests. If you would like to avoid mailing in your protest, check with the appraisal district you will be filing the protest in to see if they allow for email or online portal filings. It will make your life that much simpler. 

Congrats on Filing Your Protest! Now What?

Now that you have filed your Property Owner’s Notice of Protest, you will have to defend your reason for the protest, put forth your own opinion of the property’s value with supporting evidence, and convince either the appraisal district or an Appraisal Review Board that your opinion is justified. This is not an easy task. However, do not worry if you find yourself intimidated or feeling lost in this upcoming process. Wayfinder specializes in Texas Multifamily valuation appeals, and we know how to guide owners through this difficult path to tax savings. 

See How Wayfinder Can Help

Arrow Icon