Friday, March 18, 2011
Rotarians helping the world
THIS ARTICLE is about Shelterbox. I honestly can't remember if a Rotarian founded it (and don't have a moment to pull up the back-story), but I know that Rotarians around the world support this worthy cause (note the Rotary Wheel on the pocket of the gentleman in the story). When disaster strikes anywhere around the world, Shelterbox is THERE. Each 'box' is $1,000.00. Please consider donating to the cause!
Wednesday, February 16, 2011
New Year, New Law
Here's my latest newsletter item; some of it is a 2nd look at a prior post on SB 346 but it's worth reading again!
It's 2011 and I wanted to make sure you were aware of a new law that took affect on January 1--there is a "new and improved" law relating to appealing the valuation of your property. I took a 39 page Georgia state Senate bill and tried my best to summarize it, ending up with a 3 page summary. Instead of putting all that info in this newsletter, it can be found using THIS LINK. Suffice it to say that if you haven't yet received your 2011 valuation from the county, you can still use the PT-50R form found HERE to get the process started, but as so much has changed it would be a good idea to take some time to read my summary. Click here to read a recent AJC article about using that form and gives some background about the property tax return process.
One other reminder--you do need to file your homestead exemption if you purchased your home in 2010 or if you did something to change the title of your property in 2010. For example, if you added (or removed) your spouse/ partner/ other, you may have jeopardized your homestead exemption--even if you didn't need to re-file, it doesn't hurt to do so as you'd hate to see your taxes go UP, right? Note--if you merely refinanced and signed only a Security Deed, there is no change in the title to your property and no change to the exemption is needed.
While I'm on the topic of exemptions, click on THIS link to find out all of your county's available exemptions--you may qualify for more than you realized!
It's 2011 and I wanted to make sure you were aware of a new law that took affect on January 1--there is a "new and improved" law relating to appealing the valuation of your property. I took a 39 page Georgia state Senate bill and tried my best to summarize it, ending up with a 3 page summary. Instead of putting all that info in this newsletter, it can be found using THIS LINK. Suffice it to say that if you haven't yet received your 2011 valuation from the county, you can still use the PT-50R form found HERE to get the process started, but as so much has changed it would be a good idea to take some time to read my summary. Click here to read a recent AJC article about using that form and gives some background about the property tax return process.
One other reminder--you do need to file your homestead exemption if you purchased your home in 2010 or if you did something to change the title of your property in 2010. For example, if you added (or removed) your spouse/ partner/ other, you may have jeopardized your homestead exemption--even if you didn't need to re-file, it doesn't hurt to do so as you'd hate to see your taxes go UP, right? Note--if you merely refinanced and signed only a Security Deed, there is no change in the title to your property and no change to the exemption is needed.
While I'm on the topic of exemptions, click on THIS link to find out all of your county's available exemptions--you may qualify for more than you realized!
Thursday, January 27, 2011
Georgia Property Tax Appeals: SB 346
Did you know that there is a new law in Georgia as it relates to appealing your taxes? I took the 39 page bill and tried to summarize it as best I could. Suffice it to say, 39 pages down to 3 pages (single spaced at that!) means that I may have missed something. In general, however, this should give you a good 'go by' to follow. Good luck!
Summary of SB 346: Property Tax Assessment and Appeals Reform Bill of 2010
In 2010, Senate Majority Leader Chip Rogers pushed to reform property tax assessments as a result of a 2009 study committee on property taxes. The resulting Senate Bill 346 aimed to ensure that all Georgia properties were properly assessed at their true “Fair Market Value” (FMV) and set forth a clear path so that property owners have guaranteed rights to appeal. The bill had strong bi-partisan support and easily passed both the Senate (54-0) and the House (157-1) and was signed into law by the Governor last summer. The majority of the changes took affect January 1st of this year. The major changes include:
• Requirement that property owners receive an annual “Notice of Assessment”
• Guaranteed right to appeal the valuation
• Expansion of deadlines from 30 to 45 days
• The property owner ‘wins’ if the county fails to respond within 45 days
• Requirement to use ALL relevant sales for FMV, including distressed sales
• Requirement that owner receive access to all data used to determine FMV
• Sales price = FMV for following year
In years prior to the new law, how would you appeal your property taxes? If you happened to receive a “Change of Assessment Notice” it spelled out what to do. What if you just felt you paid too much in taxes the year before? You would have to know to file a form with the county’s Tax Assessor called a “Property Tax Return”. This confusing form has blanks for you to state what you felt was your property’s value as of January 1st. If the county agreed with your valuation, life is good! If they did not, you would have to appeal as if you received the Change of Assessment Notice. Regardless of how the old processes worked, it wasn’t easy to sort through-even if you happen to be a real estate professional! With that background in mind, let’s look at some of the new provisions of the law in detail.
Every year, prior to July 1st, a “Notice of Assessment” must be sent to all owners of real property. This notice has to be in a standard format statewide and will give the previous and current assessed value, an estimated tax bill (based on last year’s millage rates!) and info on how to file an appeal, including contact information for questions. If you choose to file an appeal, it must be submitted in writing—either actually received or postmarked within 45 days of the date on the Notice. It is highly recommended that you take steps to ensure that it is actually received by the county tax assessor (consider hand delivering, certified mail or overnight delivery services) as there is NO grounds for an extension of the 45 day deadline.
Why appeal? The main issue is value. Would your property sell for the amount given as assessed value? Another typical issue relates to how your home compares to others nearby. Was the appraisal uniform or similar to other properties in your neighborhood? Did you have all the exemptions you were entitled to claim? You can go to the Department of Revenue’s website to see what exemptions are offered in your county: http://www.etax.dor.ga.gov/ptd/county/index.aspx
The Notice of Assessment gives three appeal options, one of which must be chosen at the time you appeal: 1) you can go before a Board of Equalization (BOE) with an option to appeal to the Superior Court 2) Binding arbitration without the option to appeal to the Superior Court and 3) for non-homestead properties valued over $1M, you would be assigned to a hearing officer with the option of appealing to the Superior Court. There will also be a uniform form to use for your appeal. If you appeal to the BOE or Hearing Officer there are no filing costs; if you file for arbitration, the loser will pay for that process. Most people will typically choose to appeal to the BOE, so let’s take a look at that process.
So you filed a timely appeal, congratulations! The county Board of Tax Assessors (BTA) will acknowledge and review your appeal. Once a decision is made (within 180 days) you will receive a written notice. Again, if you approve of the value, you are finished! If you are still not happy, you will appeal to the BOE within 30 days after receiving your notice. If the county doesn’t respond to you within 180 days as above, your appeal automatically heads to the BOE.
The BOE is made up of 3 people and they will hear your appeal. At the end of your hearing they must give you a decision on the spot—from there you can appeal to the Superior Court within 30 days of the BOE’s decision. One thing to note—if you and the county come to an agreement on your value at any time along the way, you can choose to stop the appeals process at that time and that value appears to be fixed for three years.
What if your taxes are due in the middle of this process? You will receive a temporary bill, set at 85% of the current year’s valuation. If you win, you’ll get a refund of any overpayment—with interest! (don’t get too excited, the interest cap is $150) If you lose… well, you owe the amount due plus the interest as well (same cap).
Either party (you or the county) can appeal to the Superior Court and it’s treated like a completely new trial. You either go before a judge (a bench trial) or have a jury trial. There are costs to file the suit (currently around $200) and you may want to have an attorney. The standard of proof of the trial is called ‘preponderance of the evidence’ which more or less means that the person with the ‘best’ proof will win. If you are successful, you will have lower taxes and will receive ‘reasonable’ attorney’s fees back. If you lose, you will have the higher taxes reinstated, with interest, as above, capped at $150.
One of the other changes relates to the definition of an “arms length, bona fide sale”. The goal is to clarify “the new normal” as it relates to real estate (including short sales, foreclosures and other distressed sales). The new definition in the Georgia Code is:
“Arm’s length, bona fide sale” means a transaction which has occurred in good faith without fraud or deceit carried out by unrelated or unaffiliated parties, as by a willing buyer and a willing seller, each acting in his or her own self-interest, including but not limited to a distress sale, short sale, bank sale or sale at public auction.
What’s the big deal? Now assessors are forced to use ‘distressed’ sales when they consider values, so it’s not just the ‘full-price’ sales that are used. One bit of clarification—any sale “under power” such as a foreclosure on the courthouse steps is NOT considered arm’s length/bona fide sale since the bank is considered a related or affiliated party. When the bank turns around and sells it to someone else, yes, that is counted. What about Fair Market Value? That language has changed as well:
“Fair market value of property” means the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm’s length, bona fide sale. The income approach, if data is available, shall be considered in determining the fair market value of income-producing property. Notwithstanding any other provision of this chapter to the contrary, the transaction amount of the most recent arm’s length, bona fide sale in any year shall be the maximum allowable fair market value for the next taxable year…”
The Department of Revenue is unsure about the affects of the new language. What if the house is remodeled/repaired after the sale? Ditto for new construction added, parcel splits or even acreage added… It appears that the property will be ‘stuck’ at the lower value for at least a year! Likewise, there are questions remaining if that sales price is higher than the current “Maximum Allowed Value” (based on current tax freezes for example)—in theory the tax assessor would have to stick with the lower value.
What if you chose to file your appeal using arbitration? There are positives and negatives related to this process—the main issues relate to costs. If you file your appeal and ask for arbitration, you need to order a ‘certified appraisal’. A certified appraisal is “…an appraisal or appraisal report given, signed, and certified as such by a real property appraiser as classified by the Georgia Real Estate Commission and the Georgia Real Estate Appraisers Board.” A typical residential appraisal should cost $350-$500. Once you forward your written appeal to the County along with that certified appraisal (and filing fees) one of three things can happen: 1) they accept the value—congrats! 2) they disagree, and the appeal is forwarded to the Clerk of the Superior Court who sets up Arbitration or (the big one) 3) if the county does NOTHING (e.g. they don’t agree, disagree, or even call to say “boo”) after 45 days, then the value on your certified appraised value becomes ‘the’ value! If you do end up in arbitration and lose, then you are responsible for the costs of filing and the costs of the arbitration so you better be sure! Likewise, the arbitration is now final (e.g. no appeal to the courts!). As noted earlier, if you and the county come to a written agreement on your value at any time along the way, you can choose to stop the appeals/arbitration process.
That’s a lot of information to try to summarize! I hope that this has cleared up some of the new provisions found in SB 346. One thing to note about taxes—even though you may be able to lower your property values, the county can always raise the millage rates, which would lead to higher taxes. With that being said, most leaders are hesitant to do that and you would hear about any such changes in advance and have the opportunity to comment and be in touch with your elected officials. Regardless, good luck with your appeal! Feel free to contact me with any questions!
Summary of SB 346: Property Tax Assessment and Appeals Reform Bill of 2010
In 2010, Senate Majority Leader Chip Rogers pushed to reform property tax assessments as a result of a 2009 study committee on property taxes. The resulting Senate Bill 346 aimed to ensure that all Georgia properties were properly assessed at their true “Fair Market Value” (FMV) and set forth a clear path so that property owners have guaranteed rights to appeal. The bill had strong bi-partisan support and easily passed both the Senate (54-0) and the House (157-1) and was signed into law by the Governor last summer. The majority of the changes took affect January 1st of this year. The major changes include:
• Requirement that property owners receive an annual “Notice of Assessment”
• Guaranteed right to appeal the valuation
• Expansion of deadlines from 30 to 45 days
• The property owner ‘wins’ if the county fails to respond within 45 days
• Requirement to use ALL relevant sales for FMV, including distressed sales
• Requirement that owner receive access to all data used to determine FMV
• Sales price = FMV for following year
In years prior to the new law, how would you appeal your property taxes? If you happened to receive a “Change of Assessment Notice” it spelled out what to do. What if you just felt you paid too much in taxes the year before? You would have to know to file a form with the county’s Tax Assessor called a “Property Tax Return”. This confusing form has blanks for you to state what you felt was your property’s value as of January 1st. If the county agreed with your valuation, life is good! If they did not, you would have to appeal as if you received the Change of Assessment Notice. Regardless of how the old processes worked, it wasn’t easy to sort through-even if you happen to be a real estate professional! With that background in mind, let’s look at some of the new provisions of the law in detail.
Every year, prior to July 1st, a “Notice of Assessment” must be sent to all owners of real property. This notice has to be in a standard format statewide and will give the previous and current assessed value, an estimated tax bill (based on last year’s millage rates!) and info on how to file an appeal, including contact information for questions. If you choose to file an appeal, it must be submitted in writing—either actually received or postmarked within 45 days of the date on the Notice. It is highly recommended that you take steps to ensure that it is actually received by the county tax assessor (consider hand delivering, certified mail or overnight delivery services) as there is NO grounds for an extension of the 45 day deadline.
Why appeal? The main issue is value. Would your property sell for the amount given as assessed value? Another typical issue relates to how your home compares to others nearby. Was the appraisal uniform or similar to other properties in your neighborhood? Did you have all the exemptions you were entitled to claim? You can go to the Department of Revenue’s website to see what exemptions are offered in your county: http://www.etax.dor.ga.gov/ptd/county/index.aspx
The Notice of Assessment gives three appeal options, one of which must be chosen at the time you appeal: 1) you can go before a Board of Equalization (BOE) with an option to appeal to the Superior Court 2) Binding arbitration without the option to appeal to the Superior Court and 3) for non-homestead properties valued over $1M, you would be assigned to a hearing officer with the option of appealing to the Superior Court. There will also be a uniform form to use for your appeal. If you appeal to the BOE or Hearing Officer there are no filing costs; if you file for arbitration, the loser will pay for that process. Most people will typically choose to appeal to the BOE, so let’s take a look at that process.
So you filed a timely appeal, congratulations! The county Board of Tax Assessors (BTA) will acknowledge and review your appeal. Once a decision is made (within 180 days) you will receive a written notice. Again, if you approve of the value, you are finished! If you are still not happy, you will appeal to the BOE within 30 days after receiving your notice. If the county doesn’t respond to you within 180 days as above, your appeal automatically heads to the BOE.
The BOE is made up of 3 people and they will hear your appeal. At the end of your hearing they must give you a decision on the spot—from there you can appeal to the Superior Court within 30 days of the BOE’s decision. One thing to note—if you and the county come to an agreement on your value at any time along the way, you can choose to stop the appeals process at that time and that value appears to be fixed for three years.
What if your taxes are due in the middle of this process? You will receive a temporary bill, set at 85% of the current year’s valuation. If you win, you’ll get a refund of any overpayment—with interest! (don’t get too excited, the interest cap is $150) If you lose… well, you owe the amount due plus the interest as well (same cap).
Either party (you or the county) can appeal to the Superior Court and it’s treated like a completely new trial. You either go before a judge (a bench trial) or have a jury trial. There are costs to file the suit (currently around $200) and you may want to have an attorney. The standard of proof of the trial is called ‘preponderance of the evidence’ which more or less means that the person with the ‘best’ proof will win. If you are successful, you will have lower taxes and will receive ‘reasonable’ attorney’s fees back. If you lose, you will have the higher taxes reinstated, with interest, as above, capped at $150.
One of the other changes relates to the definition of an “arms length, bona fide sale”. The goal is to clarify “the new normal” as it relates to real estate (including short sales, foreclosures and other distressed sales). The new definition in the Georgia Code is:
“Arm’s length, bona fide sale” means a transaction which has occurred in good faith without fraud or deceit carried out by unrelated or unaffiliated parties, as by a willing buyer and a willing seller, each acting in his or her own self-interest, including but not limited to a distress sale, short sale, bank sale or sale at public auction.
What’s the big deal? Now assessors are forced to use ‘distressed’ sales when they consider values, so it’s not just the ‘full-price’ sales that are used. One bit of clarification—any sale “under power” such as a foreclosure on the courthouse steps is NOT considered arm’s length/bona fide sale since the bank is considered a related or affiliated party. When the bank turns around and sells it to someone else, yes, that is counted. What about Fair Market Value? That language has changed as well:
“Fair market value of property” means the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm’s length, bona fide sale. The income approach, if data is available, shall be considered in determining the fair market value of income-producing property. Notwithstanding any other provision of this chapter to the contrary, the transaction amount of the most recent arm’s length, bona fide sale in any year shall be the maximum allowable fair market value for the next taxable year…”
The Department of Revenue is unsure about the affects of the new language. What if the house is remodeled/repaired after the sale? Ditto for new construction added, parcel splits or even acreage added… It appears that the property will be ‘stuck’ at the lower value for at least a year! Likewise, there are questions remaining if that sales price is higher than the current “Maximum Allowed Value” (based on current tax freezes for example)—in theory the tax assessor would have to stick with the lower value.
What if you chose to file your appeal using arbitration? There are positives and negatives related to this process—the main issues relate to costs. If you file your appeal and ask for arbitration, you need to order a ‘certified appraisal’. A certified appraisal is “…an appraisal or appraisal report given, signed, and certified as such by a real property appraiser as classified by the Georgia Real Estate Commission and the Georgia Real Estate Appraisers Board.” A typical residential appraisal should cost $350-$500. Once you forward your written appeal to the County along with that certified appraisal (and filing fees) one of three things can happen: 1) they accept the value—congrats! 2) they disagree, and the appeal is forwarded to the Clerk of the Superior Court who sets up Arbitration or (the big one) 3) if the county does NOTHING (e.g. they don’t agree, disagree, or even call to say “boo”) after 45 days, then the value on your certified appraised value becomes ‘the’ value! If you do end up in arbitration and lose, then you are responsible for the costs of filing and the costs of the arbitration so you better be sure! Likewise, the arbitration is now final (e.g. no appeal to the courts!). As noted earlier, if you and the county come to a written agreement on your value at any time along the way, you can choose to stop the appeals/arbitration process.
That’s a lot of information to try to summarize! I hope that this has cleared up some of the new provisions found in SB 346. One thing to note about taxes—even though you may be able to lower your property values, the county can always raise the millage rates, which would lead to higher taxes. With that being said, most leaders are hesitant to do that and you would hear about any such changes in advance and have the opportunity to comment and be in touch with your elected officials. Regardless, good luck with your appeal! Feel free to contact me with any questions!
Wednesday, January 26, 2011
Today's Quote
Attributed to Abraham Lincoln:
You cannot help the poor by destroying the rich.
You cannot strengthen the weak by weakening the strong.
You cannot bring about prosperity by discouraging thrift.
You cannot lift the wage earner up by pulling the wage payer down.
You cannot further the brotherhood of man by inciting class hatred..
You cannot build character and courage by taking away people's initiative and independence.
You cannot help people permanently by doing for them, what they could and should do for themselves.
Good stuff!
You cannot help the poor by destroying the rich.
You cannot strengthen the weak by weakening the strong.
You cannot bring about prosperity by discouraging thrift.
You cannot lift the wage earner up by pulling the wage payer down.
You cannot further the brotherhood of man by inciting class hatred..
You cannot build character and courage by taking away people's initiative and independence.
You cannot help people permanently by doing for them, what they could and should do for themselves.
Good stuff!
Thursday, December 9, 2010
Mind your own business Pete Borden, take 2! (The Recap!)
This is my prior post on Walter G. "Pete" Borden and I have to say that I am still just as annoyed about the entire situation. To give an update, Mr. Borden was DENIED but it wasn't soon enough to allow my son's high school to have the turf installed. The football year-end banquet was last Monday and the Coach noted that the new turf field is in the process of being installed (brrr!). I am curious how much his silly argument cost our county to defend? All I know that my son (a/k/a "the retired football player") never got the chance to play on that 'field of dreams'. In all honesty, no, I don't think his season was any better or worse due to that delay, but I would have liked to see him play on the new field. Maybe we'll go see a game or two at Sprayberry High next year, but it obviously won't be the same without Joey. So shame on you Pete Borden, for actually wasting our taxpayer money by filing a lawsuit and causing delays in a process that I SPECIFICALLY VOTED FOR.
Tuesday, November 23, 2010
We're # 6!
I'm surprised we were only in the top-10 once! We all know Atlanta traffic is always a mess; this article makes it "official"! So be careful out there as you travel; avoid 285 and you should be fine ; ) I sure wish the Northern Arc was not so politicized in the past! We could really use a 'relief' road between I-85 and I-75 on the Northside of ATL but that fell apart years ago... Oh well...
Wednesday, November 10, 2010
Real Estate Lawyers versus Witness Only closings
I couldn't write an article on this subject as clearly as this one, as it references a court case in Massachusetts. I applaud their efforts and I am hopeful that efforts to stop the same activities in Georgia will be successful in the future. Yes, I know this sounds incredibly 'protectionist' of me--it is. Yes, I want to ensure that as a closing attorney I have a job.
BUT in all honesty these witness-only firms are not held to the same standards as I am. I try to leave a title cleaner than I found it--I either fix a title issue (open loan deed, etc.) or have detailed notes to share with a future lawyer who finds an issue with my file. In essence, I care about the actual practice of law (and I truly feel that the closing process is a 'start to finish' proposal--not just sitting at the table with a blue pen and my notary stamp). For that matter, who is going to fix the title issue caused by some out of state company? When you go to sell your house you may find that your last closing created a huge error that will be costly to fix! I find issues all the time--even one refinance uncovered a situation where the gentleman actually owned NOTHING (a long story, but after a month or so I was able to fix the problem).
Final thought--witness-only closings (or closings handled by out of state companies, with or without a lawyer involved) are not always the cheapest option. Costs in Georgia are very competitive (at least in the ATL area). It may seem like a good deal to have a 'one-stop' shopping experience but after 15 years I have seen that you either 'get what you pay for' or you can also get screwed. Choose wisely--choose to close with a fully licensed real estate law practitioner.
BUT in all honesty these witness-only firms are not held to the same standards as I am. I try to leave a title cleaner than I found it--I either fix a title issue (open loan deed, etc.) or have detailed notes to share with a future lawyer who finds an issue with my file. In essence, I care about the actual practice of law (and I truly feel that the closing process is a 'start to finish' proposal--not just sitting at the table with a blue pen and my notary stamp). For that matter, who is going to fix the title issue caused by some out of state company? When you go to sell your house you may find that your last closing created a huge error that will be costly to fix! I find issues all the time--even one refinance uncovered a situation where the gentleman actually owned NOTHING (a long story, but after a month or so I was able to fix the problem).
Final thought--witness-only closings (or closings handled by out of state companies, with or without a lawyer involved) are not always the cheapest option. Costs in Georgia are very competitive (at least in the ATL area). It may seem like a good deal to have a 'one-stop' shopping experience but after 15 years I have seen that you either 'get what you pay for' or you can also get screwed. Choose wisely--choose to close with a fully licensed real estate law practitioner.
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