I purchased this cottage some years ago with the intention of gutting it and using it to store my inventory. The cottage property adjoins my backyard, so it’s quite convenient. Since the purchase occurred on December 31st, the taxes were completely paid by the seller for that year. However, after receiving my property tax statement in December the next year, the amount did not reflect the lower cost I had paid for the property. It was too late to challenge the tax assessment for that year , so I had to pay taxes based upon a higher value.
Appraisal v. Assessment
The assessed value is used when a property tax is levied by the taxing authority. For example, a city tax assessor is responsible for determining the assessed value for every parcel of land and every building within the city.
An appraised value is an expert’s best estimation of what the property is worth, while the fair market value is what it should sell for. The appraised value and the fair market value, in theory, should be the same amount. However, that is not always the case.
So, how does one go about challenging the assessment? It depends upon your local administrative rules. In my case, I made an appointment with the appraisal service during a specific two-week time period in May. Had I not gotten a favorable review, I would need to appeal to the next level.
Luckily my “before” photos and the fact there are no utilities after being gutted were enough to convince the appraiser that my cottage is indeed a storage facility rather than an abode.
Just recently, the Wisconsin Supreme Court repealed a Wisconsin Statute that stated if you deny an assessor entry into your home, you cannot challenge your assessment. The Court found property owners’ due process rights were denied.
Burden of Proof
Wisconsin’s “burden of proof” rules for challenging a property tax assessment is a sufficient means to ensure a fair and accurate system. Under these rules, the assessor’s opinion of value is presumed to be correct. The property owner has the burden to prove the assessment is incorrect. So even if an owner refused the assessor entry, the owner must still provide evidence showing the assessor was incorrect. Thus the owner’s rights are preserved.