Just because the Dallas Central Appraisal District (DCAD) says your home increased in value doesn’t mean that’s true.
With a few simple steps and information you probably already have handy, you can potentially lower your annual property tax bill.
The Advocate asked neighborhood experts to walk us through the simple process.
“As interest rates have gone up, property values in general have gone down this past year,” says Toby Toler, a neighborhood resident and owner of Toler Company, a residential and commercial property tax consulting company for the past 40 years (tolerco.com).
“Sometimes it may seem like the appraisal district is genetically predisposed to defend their determination of property value,” Toler says. “So you need to present evidence of something they don’t already know about your home in order to have a successful result.”
Worried that protesting might make your tax assessment even higher? Don’t be.
“We don’t raise value as part of a protest. There’s no fear of that happening,” says Cheryl Jordan, DCAD director of community relations. “Some appraisal districts do that, but we don’t.”
SO IT’S APRIL 21
When you receive your home’s notice of valuation, you have a few options if you believe DCAD’s value is too high:
Visit dallascad.org and check the information listed there for your home. Does DCAD have the correct number of bathrooms and bedrooms listed? Is the square footage correct? Is the year the home was built listed correctly?
“In high-dollar areas, square footage or the number of bathrooms doesn’t have to be that far off at $500 or $600 per square foot in value to make a difference,” says neighborhood resident David McGee, owner of David L. McGee Appraisals (dmcgeeappraisals.com).
“Even if DCAD is off by only 100 or 200 square feet, that’s several thousand dollars of additional taxable value you’re paying for.”
While on dallascad.org, look up the values of similar neighboring homes. Yes, it’s interesting to know the valuation of neighbors’ homes, but that’s not the point: Use that information to prove your home is overvalued.
Check out the Advocate’s print magazine or website for neighborhood Realtors, and ask one for a report on “comparables” for your house. Realtors have access to the Multiple Listing Service, which compiles data for most home sales in Dallas County. A Realtor can find comparable homes that have sold within the past 12 months to determine an appropriate value for your home. Remember, though: Realtors are only paid when they assist you with buying or selling a home, and they’re hoping this investment of time will eventually lead to working with you to eventually buy a new home or list your existing home.
If you really want rock-solid evidence of your home’s value, hire a property appraiser. The appraisal will set you back about $400-$750 (homes over 4,000 square feet or so tend to cost more), but you’ll have an independent, third-party valuation with comparables and adjustments (age, condition, improvements, location), McGee says.
You can file a protest online anytime after April 21; there’s no cost, and the sooner you file the protest, the more quickly your case will be reviewed.
“There’s no benefit to waiting if you know the value is wrong,” Toler says.
“DCAD’s phones typically aren’t clogged the first two weeks after value notices are mailed. People with a case ready to go are rare.”
Fill out the online “file a protest” form on your property’s account page at dallascad.org, upload the “evidence” that proves your home is overvalued, and write a short, concise explanation of your concerns.
DCAD computer algorithms typically analyze comparables and determine individual property values, so there’s room for human analysis to fine-tune those values, Jordan says.
Maybe your home is on a busy street, while the algorithm has selected comparables that are on quieter, more valuable streets.
Maybe your home needs a lot of remodeling or updating, but the algorithm hasn’t taken that into account while selecting new or updated homes nearby.
“The best thing that I’ve had luck with is to take a picture of everything that’s wrong with your house, print out the pictures and show all of those problems to DCAD,” McGee says.
“Show them all the things that need to be repaired — cracks in the foundation, original bathrooms, busted driveway, your house backs up to a drainage ditch with dead animals in it — show them your condition rating if it’s different from the comparables. That gives the (DCAD) appraisers a way to adjust your valuation.”
Focusing on your home’s shortcomings can help, but it’s not a guarantee.
“The sales market has changed in the past four years,” Jordan says. “It used to be that when you sold a property, you would fix it up. Nowadays, people are selling as-is. That has already been accounted for in (DCAD’s) value because the sale accounted for that in the price.”
TAKING THE NEXT STEP
This is your deadline to file an appeal of your valuation with the Appraisal Review Board, which is a panel (or sometimes an individual) paid on a per-day basis to evaluate appeals.
The ARB hearing panel is a “buffer” of sorts to ensure DCAD’s appraisers are fairly evaluating your property’s value.
Typically, you will upload/mail the same information you used while negotiating with DCAD while hoping for a better valuation outcome.
ARB members rely on a DCAD appraiser who attends the hearing and presents evidence about valuation — if you don’t have an extremely compelling case, it’s likely the ARB will side with DCAD’s appraiser, perhaps throwing you a 1% or 2% token valuation “bone” as a consolation prize.
Some ARB hearings are in-person, meaning you will need to travel to attend what likely will be a 15- to 30-minute hearing. Some hearings are conducted by telephone (not Zoom).
You have the right to request any information DCAD is using to value your property, including data, schedules, formulas and comparables — as long as you request the information in writing and at least 14 days prior to the ARB hearing.
During the hearing, you’ll have a chance to succinctly state your case to the ARB, and the DCAD appraiser will do the same thing. Then the ARB will rule on your case immediately.
SO YOUR VALUATION IS STILL TOO HIGH — NOW WHAT?
You’ve negotiated with DCAD, and you’ve presented your case to ARB, and you’re still convinced your home is being overvalued: You have one option left — file a request for binding arbitration with the Texas comptroller’s office or file a lawsuit in District Court. (The lawsuit option typically makes economic sense only for high-dollar homes and commercial properties.)
You’re going to forward the same information you’ve already compiled to the comptroller, along with a check for $450 (or more, depending on your property’s value).
Think carefully about this step, because your deposit, less $50, will be refunded only if the arbitrator sets your home value closer to your proposed valuation than to DCAD’s valuation.
Here are the details:
• You must file for binding arbitration within 60 days of receiving your ARB determination; for the most part, you’ll be sending the same information you’ve submitted to DCAD and ARB in hopes you can convince the arbitrator to come to a different conclusion.
• You must be current with your property taxes.
• You must complete a Form AP-219, Request for Binding Arbitration (PDF) form available online, and send that form, along with a copy of the ARB determination, any relevant documentation and your filing fee to the address on the Form AP-219.
Once you’ve submitted your Form AP-219 and it has been received and acknowledged by the comptroller, you have 45 days to reach a settlement with DCAD prior to your case being assigned to an arbitrator.
The arbitrator will set a date, time and location for a hearing — it can also be held via Zoom. Your success will determine not only your property tax bill but also how much, if any, of your deposit is returned to you.
Example: You believe your house should be assessed at $400,000, and DCAD believes your house should be assessed at $500,000. If you and DCAD don’t reach a settlement and the arbitrator determines the correct value for your house should be $451,000, your valuation will be set at $451,000 but you will forfeit your deposit since the final value was closer to DCAD’s valuation than to yours.
DRUM ROLL, PLEASE
Once you’ve uploaded the information, a DCAD appraiser may give you a call or send you an email asking for more information or, if you’ve been persuasive, offering a lower value for your property.
“It’s OK not to take their first offer,” Toler says. “It can’t get any worse, and you can always say something like ‘I was expecting more,’ or ‘I don’t think that offer gets me there,’ or ‘Is there any more slack in your rope?’
“If they’re willing to make you an offer, it’s not going to go away — that’s likely their new value for your home,” Toler says.
Remember you have until July 14 to reach an agreement, so work to get your best offer from DCAD no later than July 1 so you have time to take the next step, if you need to.
Editor’s Note: Dates and deadlines are subject to change depending on when DCAD sends out tax notices. Check dallascad.org for up-to-date deadlines and information about procedures for filing protests. For more detailed information about protesting your taxes, including how DCAD determines property values, visit our website and search Property Tax Protest.