Are You Serious, Property Tax Cap is Not Working

Originally posted 2009-12-24 05:00:21. Republished by Blog Post Promoter

Visiting and revisiting the property tax issue has become a pet peeve of mine for many reasons:

• Property taxes are too high
• Cities, towns, and states rely to heavily on property taxes so there is no incentives to lower property taxes
• As a result of the property taxes being thought of as an open check, there is a lot of governmental overspending and abuse of monetary privileges.

To add insult to injury on this issue, I found an article today that states that here in Indiana farmers, as well as, homeowners are not getting the anticipated tax relief that the tax cap hope to create due to increases in the assessed value.

I am sorry, an increase in assessed value in a real estate market where a seller can not get what he or she paid just two years ago on a home.

Readers the only way to eliminate this hog wash is to file your property tax appeals.  Here is some helpful links below that will help with that:

• What is Assessed Value and How Does It Influence My Property Tax
• Property Tax Appeal Review (Video 1 of Section 1)
• Evaluation of Property Tax Appeal Findings

Related articles on property taxes

• Rents drop for 128,500 T.O. households (cbc.ca)
• Wis. court won’t review tax ruling against Xerox (seattletimes.nwsource.com)
• Daley Property Tax ‘Gimmick’ Clears Finance Committee (huffingtonpost.com)
• Property tax debate flares up in P.E.I. (cbc.ca)
• Tax changes mean big hit for P.E.I. homebuyers (cbc.ca)

Evaluation of Property Tax Appeal Findings

Originally posted 2008-12-30 09:47:38. Republished by Blog Post Promoter

The objective of the series of videos that follows in the next couple of days is an evaluation of the the findings of property tax appellate court.  This evaluation is not a guarantee that you will be successful with your appeal for an assessment in your property taxes, but it does arm you with the tools needed to possibly becoming successful in your quest to get your property taxes adjusted in your favor.

For your convenience, below you will find the links to the property tax reviews that we will be evaluating:

• Appeal Review 1

http://www.ingov/ibtr/files/JackRipley.pdf

• Appeal Review 2

http://www.in.gov/ibtr/files/DavidandPatriciaSullivan.pdf

The Appeal Process has time ranges and time limits which also will be part of the video series of discuss.  Please find the link to that information below:

http://www.in.gov/ibtr/files/AppealsProcess

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Real Estate Investor Related Articles

Protecting Your Investments – This article discusses the business entities that are available that are available for investors to protect their personal assets when buying and holding properties.

Property Tax Related Articles

Indiana Property Tax Appeal (Part 2) -Filing a property tax appeal can be difficult.  This article gives links to the forms needed to file the appeal and a video tutorial on filling the forms out.

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Who is at Fault When a Blog Covers More than Real Estate

Originally posted 2009-12-15 17:07:42. Republished by Blog Post Promoter

Recently, I received a comment or clique from a fellow Realtor who stated that this blog has several topics.  Well, my colleague may not realize that real estate is affected by several things.  One of which is economics.  This blog was developed with that in mind.

I mean, let’s face it if an individual does not have a job he or she does not have income to purchase a home.  If an individual does not understand how to maintain good credit or rebound from bad credit, he or she can not purchase a home.  If an individual does not understand how to get reduction on personal taxes or property taxes, then an individual can not keep a home.

I would love to know how you, the reader, feels should this blog stick to real estate only or give you current events and topics and relate them to how it influences your ability to purchase or keep your home.  Is it right or wrong to cover more than real estate?

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Types of Ownership Deeds

Originally posted 2008-11-29 13:58:08. Republished by Blog Post Promoter

Image by S Migol via Flickr

There are different types of ownership deeds you may receive as a real estate investor.  The types of ownership deeds are general warranty deed, sheriff’s deed, quit claim deed, special warranty deed, tax deed, trustee deed, and certificate of title.

It is important to understand that no matter which ownership deed you receive it is best to have title insurance on it.

Title insurance is a policy that guarantees that the title for the property is clear of liens and/or judgments.  It also guarantees that the owner of the property has the right to sell the property.

The title insurance protects the owner and the new owner from losses that may arise from unknown or undisclosed defects in the pas chain of title.  Unlike most insurance, title insurance is paid in an one time installment at the closing.  This one time fee protects your interest as the new owner and your heirs interest for as long as you own the property.

The title policy is insured by the title company.  The title company will provide legal defense against any and all challenges to the title and reimburse the owner against any losses as a result of hidden or unknown defects in the owner’s rights.

Now, that we understand what the title insurance is.  Let’s examine the different types of ownership deeds.

As an investor, you may come to own your property through a special warranty deed.

Let examine what happens to get you the special warranty deed.  First, there is a sheriff’s deed issued by a judge.  This is issued by a judge to satisfy a judgment or lien.  This takes place in a foreclosure.

Before we get to the sheriff’s deed or special warranty deed, the mortgage company receives a certificate of title after the foreclosure.    This is how the property is conveyed to the mortgage company.  Ater the mortgage company acquires the sherriff’s deed, they must convey a warranty of ownership to the new owner.  The mortgage company does this through a special warranty deed.  Be aware, that a special warranty deed only warrants back to the mortgage company’s ownership not any further.  Remember, until the last payment the mortgage company really owns the property.  You, as the owner, has insurable interest.  Insurable interest is your right or benefit that you have in the property.  Mening as long as the mortgage payment is current your interest is still there.  Once you are late or not able to pay your interest is superceded by the mortgage company.  However, you can still protect your interest in the property if your situation or ablility to pay has now changed for the better visit www.freedomforeclosure.com/taylorbrown to find out how.

Other forms of deeds include a tax deed.  A tax deed is given if the homeowner has not paid their property taxes and someone else pays those taxes for the homeowner. This person receives this document when paying taxes on the behalf of the homeowner at a tax sale.

Still yet, there is another type of deed.  It is a trustee deed.  A trustee deed is used to convey a property out of a trust.

The next type of deed is a quit claim deed.  A quit claim deed is used to release whatever interest the owner has in the proeprty to someone else.

The deed that offers the most protection is the general warranty deed or warranty deed.  This deed warrants against all defects in chain of ownership before or after ownership of the property.

Related Deed Articles

• TaxDeedLists.com Helps Investors Explore Emerging Careers in Property Investments (prweb.com)
• The Statutory Warranty Deed: What You Should Know as the Seller (raincityguide.com)
• Fannie Mae Announces Deed for Lease Program (raincityguide.com)

What to Consider if You Are Thinking of Filing a Property Tax Appeal on a Commercial Property

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Has your Chicago property tax increased? Is your property commercial or industrial?   If it is either you may be interested to know that you may be eligible to file a property tax appeal.

You may be wondering how is my property classified as commercial or industrial.  If a multi-family unit has over 4 units, it is commercial. Commercial property also includes office buildings, industrial property, medical centers, hotels, malls, retail stores, shopping centers, farm land, multifamily housing buildings, warehouses, and garages.    Industrial properties, on the other hand, are factories, warehouses, heavy manufacturing buildings, industrial parks, light manufacturing buildings, and research and development parks.

Once you have ensure that your property meets the above criterias to consider a commercial or industrial property, you must understand several terms that appear on the property tax bill.

You may need to know what is meant by the term assessed value.  Assessed value is determined by converting the fair market value.  To convert the fair market value, the assessor applies the appropriate assessment ratio.  To determine the ratio, the assessor utilizes the internal sales divided by the available rental data for the area.  Then, there is a mass appraisal given for the area.  The mass appraisal for the area is equivalent to the mass appeal for the area.  It is important to note, that the assessor does not do a personal inspection of the property during this determination of assessed value.  However, if an appeal is filed the assessor has to do a personal inspection of the property to determine the error in the value.

The latter is one of the first items that you look at to determine if a property tax appeal is necessary.  It is especially important to determine the latter if you recently purchased the property.

Next, determine if the description of the property is correct on the property tax bill.  If you have an apartment complex and it states that there is a gas station on the bill then there is a reason to file an appeal.

Next, determine if the square footage of the property is correct.  You can look at an appraisal that you may have, the blueprints for the property, or have the property measured by a Realtor or a license appraiser.

Still yet, there may be an error in the lot size.  If the lot size is incorrect then that could also cause the property tax to be more than it needs to be.

If you recently had a decrease in tenants, then you may have a reason to file a property tax appeal.  This is a little tricky because the determination of this reason is if your decrease is 25% or more than the previous year.

If there was a hardship such as, road construction, flood , fire, looting,  new construction, that caused the loss of income and tenants then you may be eligible to file an appeal.  If any of the above reasons are applicable to your property then contact

• the Cook County Assessor Office
• the Cook County Board of Review
•  the Illinois Property Tax Appeal Board
•  the Circuit Court of Cook County to file the appeal.

Related articles

• Getting a fair appraisal in a tough market (sfgate.com)
• How to Lower Your Property Taxes (online.wsj.com)
• Businesses upset at fee increase for tax appeals (kansas.com)

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Indiana Property Tax Cap Vote on Tuesday

Image by K. Todd Storch via Flickr

The first step in giving  Indiana citizens the right to determine how much property taxes will be paid in the state begins on Tuesday.    The Indiana House of Representative is voting on a cap of one percent of the assessed value for homeowners, two percent of the assessed value for investors, and three percent of the assessed value for business owners.    This vote is essential because if approved it will go to the Indiana Senate, and then to the public for a vote in 2010 to make it a permanent change to the state constitution.

With the approval of this groundbreaking measure, the residents will final be able to make local cities, towns, and municipalities responsible for wreckless spending that has been going on for decades.  No longer will there be endless amount of money on the back of the citizens of the state.

Related Articles that Oppose Unfair Taxes and the Like

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• Poll: CA Voters Reluctant To Change State Budget Process (crooksandliars.com)
• Skelos to Paterson: Give us ‘a bill we can act on’ (timesunion.com)

Indiana Can’t Even Get Budgeting Right

Did you know that Indiana ranked 49th out of 50 in a recent evaluation of the state’s budgeting process?  The main reason the state scored so low was due to not having line item veto and not having a requirement to balance the budget.  With the country’s economical vitality hanging in the balance, Indiana has once again made itself a spectacle of bad government.

The commitee that evaluated the state’s budget did not agree with Representative Jeff Espich that “Indiana’s system is open and appears to be leading Indiana in the right direction.”  I do not agree with the Representative, either.

The state by no means is heading in the right direction, with the highest unemployment rate in decades.  By no means is Indiana headed in the right direction.

There is, however, a slow process in place to resolve the unfair and expensive property taxes.  The first measure that the state took was to realize that there was a problem with the way the assessed value was determined.  However, the state did not come to this conclusion on its own.  It took a law suit. 

Ten years ago a new construction property owner filed a law suit claiming that the assessed value was unfairly advantageous to homeowners of older homes due to the lower assessed value.  The courts agreed and ruled that the assessed value will be determined by a fair market value system.  This fair market value system, however, still needs to be added to the outdated Indiana constitution.  Therefore, the residents of Indiana will be voting on adding this system and changing to a flat rate for all assessed properties.  The rates will be one percent for homeowners, two percent for investors, and three percent for business owners. 

The market value system was adopted and began in 2001; however, it took over two years before any muncipality received the much needed funding.    The flat rate system; however, will be voted on 2010 and if approved by the citizens it will take affect in 2011.

Instead for the last property tax collection in 2000, the state ruled that a collection of seventy percent of that year’s bill would cover any short fall for the new unknown tax bill when it was available. 

This proved to be disasterous for many new buyers because the title companies left it up to the sellers and the buyers to settle any shortfalls.

Incidentally, it took over two years before the figures were known.  As a result, I had a client who was unfairly paying property taxes forom a seller who refused to pay the property taxes when the figures was known years later.  The buyer had to sue the seller.

From the latter scenario, you may be able to see why I, nor the media believe that the “state is on the right track.”

Tell me what you think?  Do you think the state is on the “right track?”

Reducing Cost is It a Sin

Recently, I did several post on appealing your property taxes assessment.  Well, today I found an informative podcast at http://www.pepperpodcasts.com/pepper_podcasts/2008/11/pursuing-realestate-tax-assessment-appeals-in-a-down-economy.html that recommend pursuing property tax re-assessment for businesses in this market.  This is along the lines of what I was recommending for your residential properties.  However, I did not mention business properties and the advantages to pursuing a re-assessment of those property taxes.   Sharon and Dusty give great pointers for business owner to help them determine if a re-assessment is necessary for them.    They go on to explain what is a good sign that the owner should consider a property tax re-assessment.

Sharon and Dusty further explain how businesses, industries, and apartment owners need to consider their vacancies and the environment to determine if they need to do a re-assessment.

Lastly, Sharon and Dusty explain how to go about doing the re-assessment.