Equalization is the raising, or lowering, of the government-assessed value of taxed property.
What Is the Purpose of Equalization?
The purpose of equalization is to ensure that the taxes for taxable property are a uniform percentage of the property’s government-assessed value across different tax districts. Equalization prevents against paying high property taxes in one tax district, while paying low property taxes in another tax district for the same piece of property.
When Is Equalization an Issue?
Equalization typically becomes an issue in three contexts:
- Divorce/Separation: If you own taxable property, are going through a divorce or separation, and live in a different tax district than your spouse and co-owner of the taxable property, then equalization may become an issue for you.
- Jointly Owned Property: If you and another person or persons own taxable property together, and you live in a different tax district than the other owner or owners, equalization may be an issue for both you and your co-owner(s).
- Multiple Tax Districts: If the same taxable property is subject to multiple property taxes at the same time, such as state, county, and city taxes, then equalization could be an issue for you.
How Are Equalization Issues Decided?
Each state or municipality has its own administrative agency, usually called a Board of Tax and Appeals, which makes the specific findings regarding your taxable property’s market value. They also decide what the equalization ratio between two tax districts should be. A separate agency, normally called a Board of Equalization and Assessments, has the power to actually change your tax liability for that tax district in regard to the taxable property.
Do I Need an Attorney for an Equalization Issue?
Because of the highly technical nature of equalization, it is strongly recommended that you find a tax attorney to represent your interest. Only a tax attorney will be able to adequately explain the issue, advise you of your rights, and guide you through the process of equalization.