Many types of property (land) are subject to being taxed by the government. The purpose and calculation of these taxes differ. Generally, homeowners are required to pay property taxes. Property tax is based on the value of one’s property, or home. State law permits taxation of property to generate revenue.

This revenue is collected by local governments, which then use it to finance government functions and services. When the government imposes a tax, it must do so accurately and lawfully. If the government does not do so, an individual may dispute the amount of tax owed.

What Entities Can Lawfully Impose Property Taxes?

Generally, a government entity constituted for general purposes (e.g., to provide for police, waste disposal, and other services for residents) can impose taxes on homeowners. These entities include cities, counties, townships, and boroughs. The tax power these entities have cannot “go beyond” their geographic boundaries. This means, for example, that one county cannot impose property taxes on the residences of homeowners who reside in another county.

What are Property Tax Assessments?

The value of property tax a homeowner must pay is determined through a process known as assessment. The simplest form of assessment is known as an “ad valorem” assessment. In an ad valorem assessment, the property is taxed based on a portion of its value. The appraisal, or determination of value, is completed periodically.

When the value changes, so does the amount of taxation. Ad valorem taxation is based on who owns the property. This means that the owner of the property is responsible for the tax regardless of whether the owner uses the property, or whether the property generates income (in the form of rental income).

What If I Believe a Tax is Inaccurate or Invalid?

If an individual disagrees with the assessment, the individual may challenge the assessment with the taxing authority. States, counties, and municipalities have processes known as grievance processes that permit homeowners to do this. Generally, a homeowner must show to the taxing authority that the assessment resulted in a value that is inaccurate. If a homeowner can show that an assessment overvalued the value of their property, the homeowner may be entitled to an adjustment in the amount of property taxes they owe.

If a homeowner is unsuccessful in the grievance process, the homeowner may file a lawsuit in court. In this lawsuit, the homeowner disputes the value of the assessment, through a tax certiorari proceeding. In this proceeding, a judge will resolve the dispute between the homeowner and the taxing authority after reviewing evidence from both sides.

What If I Believe a Tax is Invalid?

In some cases, a homeowner’s concern is not that the tax value is inaccurately determined. The homeowner’s concern is that the tax itself is illegal. A tax may be illegal because it was imposed without the taxing body’s having followed proper procedures. If the government did not follow proper procedures, an individual can argue that the tax is invalid because the government deprived the individual of their constitutional right to procedural due process of law. Procedural due process of law requires the government to follow certain procedures before taking action, such as taxation, that affect life, liberty, or property.

For example, if a county or locality requires that a vote take place before a property tax may be imposed, imposing the tax without holding the vote, or imposing the tax with insufficient approval (such as failing to obtain a majority vote), might violate procedural due process of law.

Constitutional rights also include the right to be free of discrimination by the government. The government may discriminate on many bases, including race, national origin, gender, religion, or color. The government may discriminate on these bases with respect to life, liberty, or property.

An example of the government discriminating on the basis of “life,” is when the government imposes the death penalty on a discriminatory basis. An example of discrimination against liberty is when the government allows some groups to exercise the right to freedom of speech, while denying other groups that right. The government may discriminate in how it enforces property rights.

If government laws are designed to favor one class of persons, or punish one class of persons, with respect to property ownership, such laws may be discriminatory. If a homeowner believes that the government acted discriminatorily in the property tax assessment process, the homeowner may challenge the constitutionality of the tax in court.

Do I Need the Help of a Lawyer With Property Tax Proceedings?

If you need assistance with property tax proceedings, whether in the form of grievances or in court, you should contact a real estate lawyer. An experienced real estate lawyer near you can evaluate your case, advise you as to rights and options, and assist you in taking appropriate legal action.