Challenging Your Residential Real Estate Tax Assessment
Note: We've decided to write this blog post because several callers have made us aware of a web article entitled Procedures for Challenging Your Property Tax Assessment in Iowa that offers incorrect information on the procedures and time limits for doing so. Following the procedures in that article may result in the loss of the property owner's appeal rights.
Residential real estate values are reassessed every odd-numbered year for tax purposes. Your real estate's valuation is then used determined the amount of property tax you'll owe over the next two years. Because of the impact of your real estate's valuation on the amount of your property taxes, you may wish to challenge your property's valuation. Here are the basic steps for doing so.
It's important to follow all these steps within the time required. Missing any steps or any deadlines for acting will cause the forfeiture of your appeal rights for the two-year tax cycle. In most instances, you're not allowed to use an appeal of your current tax assessment to challenge assessments from previous two-year periods.
You're allowed to challenge your property assessment for five possible reasons:
The assessment is not equitable as compared with assessments of other like property in the taxing district.
The property is assessed for more than authorized by law.
The property is not assessable, is exempt from taxes, or is misclassified.
There is an error in the assessment.
There is fraud in the assessment.
You begin the process by filing a protest with your county's board of review. Protests must be filed between April 2 and April 30 of the year of assessment with your local assessor's office. You lose your appeal rights if you don't follow this step or don't file the protest between April 2 and April 30. You have an opportunity to request a hearing before the board of review to present evidence and argument as to the correct valuation for your property. The board of review will issue a written decision of its decision on your protest and the reasons for that decision.
If you're not satisfied with the board of review's decision, you can appeal it to the Iowa Property Assessment Appeal Board ("PAAB"). If the board of review adjourned on or before May 31, your appeal must be filed on or before June 20. If the board of review adjourned after May 31, your appeal must be filed within 20 days of the board of review's adjournment. If the 20th day falls on a Saturday, a Sunday, or a holiday, an appeal will be timely if filed on the next available business day. You lose your appeal rights if you do not file a timely appeal to PAAB.
Your PAAB appeal is a great opportunity. You're allowed to redo the evidence you offered to the board of review and introduce new evidence and arguments. But, because of that, the evidence that you submitted to your county board of review is not necessarily transmitted to PAAB. You have to resubmit that information to PAAB if you wish to use it again.
The PAAB hearing is extremely important. In fact, it's the most important stage of the entire tax assessment appeal process. You have the right to appeal to the district court if you're not satisfied with PAAB's decision, but you're almost always limited on appeal to arguing the evidence you presented to the PAAB during the appeal hearing, including documents and witnesses. PAAB decisions are rarely overturned on appeal. That means you need to get the PAAB appeal hearing right and not leave out any potential evidence or testimony, either from yourself or from third-party witnesses, because if you lose the PAAB appeal you'll likely keep losing. If you lose because you were lacking in evidence, it'll be very unlikely that you'll get to go back before PAAB and have a do-over.
If your PAAB appeal is unsuccessful, you have the right to file a petition for judicial review to challenge the agency's decision. That petition must be filed within twenty days of the postmark of PAAB's decision. District courts are required to be very deferential to PAAB's decisions and only rarely overturn them. That's why it's so important to win your case in front of PAAB, rather than hoping for a miracle through a petition for judicial review. The district court's decision can be appealed to the Iowa Supreme Court.
You have the right to be represented by a lawyer during the tax assessment appeal process. The right time to bring in a lawyer is for the board of review and PAAB appeal hearing to ensure that you get your presentation right, keeping in mind that, if you lose, any appeals of PAAB's appeal decision will very likely be limited to the evidence that was presented during the appeal hearing. Quite honestly, if you lose before PAAB, it's almost too late to decide to hire a lawyer to handle further appeals because a lawyer's best chance to help you is during the board of review and PAAB proceedings.