HomeLab has over 10 years of prior experience working for local assessors, so we are familiar with the process of valuation as well as appeals. A reduction in value can offer significant savings, as it often lasts much longer than the year in which it was appealed. It often serves to “reset” the value, especially if there are actual discrepancies that are corrected such as size, basement finish, quality, or condition. These are issues that could artificially raise your property value every revaluation. We recommend one of three options for most clients, but as always it depends on your specific property and needs.
You often don’t require an appraisal in order to be successful at a property tax appeal, but if one indicates you are overvalued, especially if done as of the same effective date, it is very difficult for an assessor, or potentially a board to dispute.
In Colorado, properties are re-appraised every odd year (2019,2021,2023), but it is possible to appeal in intervening years as well. For the most part, Colorado relies on the sales comparison approach to value the property. The assessor relies on whatever data they have on your property. Because the assessor is valuing a universe of properties, it is easy for things to fall through the cracks. If there is something specific about your property that is affecting value, that the assessor may not be aware of, this is your best chance at a reduction in value.
For the 2023 assessment, the assessor is required to determine market value based on data from the 24-month base period from July 1, 2020 through June 30, 2022. The actual value of the property is based on the appraisal date of June 30th of the year prior to the reappraisal. However, it is based on the condition of the property as of Jan 1 of the reappraisal year. This can be confusing. Basically the data for all the comparable sales being used stops at June 30th, but the data for the subject property is as of Jan 1. So, no sales or market conditions can be used past June 30th to support your value. Keep in mind this means that if the market “crashes” after June 30th of the previous year to the reappraisal, it should not be taken into account for that reappraisal. Per statutes the assessor is supposed to set values at 100% of market value.
There are multiple factors that determine your property taxes in a given year. It must be explained that this page is titled “Property Tax Appeal” but that is not actually correct. That is how most people view it but you are not actually able to appeal your taxes. You can appeal your valuation which has a direct correlation to your taxes. Your taxes are based on your valuation, so if your valuation is lowered, then your taxes will be less than they would have been. However, it does not guarantee they will go down from the previous year. Keep in mind, taxes are not set until after valuations have been made, and the initial appeals have been completed. So you will not actually know your taxes when you appeal your property value. Your taxes are set based on a formula that is unique to your location. First you take the assessment rate (29% for Commercial Property, ~6.95% for Residential, this can vary) and multiply that by your value to get your Assessed Value. You receive your notice of valuation by May 1 every year. You multiple your assessed value by your mill rate/1000. Your mills are determined by local commissioners, schools, special districts, etc and are not available until the December after your valuation. So you won’t actually know your taxes until later, but you could use the previous mills as a proxy until then.
Residential home Notice of Value on May 1: $500,000
Assessment Rate: 6.95%
*It should be noted that assessors are required to split the values between land and building, but on an improved property you cannot appeal these values separately. So it doesn’t really matter how they split it up, only the total is relevant.
Mills: 120 (This value ranges significantly depending on your exact location, some newer areas have “Metro Districts” which by themselves can account for 60-100+ mills)
Taxes Due=Assessed Value 34750 * .12=$4170
Property Valuation Appeal (Tax Appeal)
Again, you are not appealing your taxes, you are appealing your value. Understanding this can go a long way when discussing your property with the assessor, as they will know you are knowledgeable about the process. For most counties you can do this online during the month of May, otherwise your notice of valuation will have instructions on how to proceed by mail or phone. The main thing is, do not appeal with no plan or evidence. In most cases you will be wasting everyone’s time. Sometimes you may get lucky and get a reduction, but it is always better to be prepared. If anything, the assessor will appreciate it and may give you the benefit of the doubt if it could go either way.
If you want to increase exponentially your chance at a value reduction, you must first determine that your property is overvalued, and then support this with actual evidence that is relevant. That is where Homelab can help. We can give you the tools and evidence you need. Generally speaking a well developed appraisal that is specifically done for this purpose (meaning efffective date matches appraisal date and condition is based on Jan 1) is your best tool. But, it is also your most expensive option. So, if you go with that option you want to be pretty sure your property is truly overvalued. An appraisal will be unbiased, meaning it does not guarantee the value will come back less than your assessor value. If you are unsure or feel it may be close, you might be better off just doing a consultation with us. We can essentially coach you on how to appeal the property, what things to focus on, what evidence to provide, etc. This would be the most cost effective option, but it is all up to you, you will not have a professional opinion of value to back you up. People have been successful both ways, it really depends on your specific situation.
MAY 1- Notice of Valuations Mailed To Taxpayers
JUNE 1 – Deadline to File For An Appeal
LAST DAY IN JUNE (OR AUGUST 15 IF ON EXTENDED TIMELINE) – County must notify taxpayer via notice of determination.
JULY 15 (OR SEP. 15 IF COUNTY IS ON EXTENDED TIMELINE) – Deadline for appealing notice of determination.
AUGUST 5 (OR NOV. 1) – County board of equalization should be done hearing appeals to nod.
IF YOU ARE DENIED AT THE BOARD, YOU HAVE 30 DAYS FROM THE TIME YOU RECEIVE A NOTICE TO APPEAL. AFTER THE COUNTY BOARD THERE IS THE STATE DISTRICT COURT, THE BOARD OF ASSESSMENT APPEALS, OR ARBITRATION.