Tax Abatements and Exemptions: How Appraisers Can Lower Your Taxes

If you live in Boston, or nearly any part of Massachusetts, you may qualify for Tax Abatements and Exemptions through the residential property tax exemption. The abatement program can save you up to $3,610.53 (the max exemption amount from last year) on your annual property tax assessment.

With the increasing cost of living and rising property values, now is the best time to start planning to claim this exemption for the next year. Being prepared and knowing the accurate value of your property will prevent being surprised by an exorbitant tax bill. To that end, this article will look into how you can benefit from the residential exemption, and what you need to do in order to claim it.

So how do you get the residential exemption?

You need to visit the website for your city or town to find the specific local application for the residential exemption. You must apply by a specific date to qualify. Typically, these exemption applications are open every January, with specific filing dates. The deadline for the previous fiscal year is usually February 1st for overvaluation, improper classification, and disproportion reasons, and April 1st for residential, personal, and statutory applications.

Don’t get too excited yet, as you’ll have to wait to apply until after you’ve received your third-quarter tax bill (typically late December). After you apply, you can expect a response within 3 months. Also, keep in mind that the abatement and exemption is available only for the current year and can’t be applied to future or past assessments.

For Boston specifically, once the tax bills have been issued, the application forms will be available online and you can conveniently fill it and submit it in person or by mail. Take your completed application to Boston City Hall, Assessing Department, or the Taxpayer Referral and Assistance Center. For other towns and cities, please visit their Assessing Department; all of them will have the appropriate information regarding applications dates, exemptions and abatement forms.

No matter what happens with the application for the abatement or the exemption, you’ll still have to pay whatever taxes are due by the due date. Also, if the Assessing Department or the Appellate Tax Board have any questions about your application, or need supporting details or documentation, you’ll need to respond within 30 days of the date you file, otherwise, your application will be automatically declined.

Just how do I qualify for the residential exemption?

The exemption is available for Massachusetts homeowners, for their primary residence, i.e. the home/house that they actually occupy and live (incidentally, you can only apply for a residential exemption for one house). The program exempts a certain amount from the property’s value, reducing the next tax bill by thousands. To qualify, you must have purchased and recorded the deed by July 1st of the current year to be eligible for an abatement on next year’s taxes. If your application for the exemption is approved, the abatement will be applied to the next third-quarter tax bill (late December).

There are also personal exemptions for certain health issues, status as a veteran or survivor of a deceased spouse or parent, or elderly exemptions for those of advanced age. Abatements are also available for co-ops occupied as primary residences, although all the members need to apply together. Even if you don’t qualify for the residential exemptions, you may still be able to qualify for an abatement if you hold the property as a charitable, religious, educational, scientific, literary, or temperance organization.

The other types of abatements include overvaluations based on purported errors by the assessing board/department, placing an excessive value on the property, improperly classifying its usage, or disproportionate assessment relative to neighboring properties. There are many reasons why a property might be overvalued by the Assessing Department.

The Assessing Department assigns values for taxation purposes only, and they do this by using the Mass Appraisal Method, which aggregates the data of entire neighborhoods or even towns, and then assigns individual values based on that cumulative and broad analysis. This of course means that for specific and individual properties, the aggregate data isn’t taking into account a house’s condition or quality, or local factors affecting certain neighborhoods or even certain streets. There might even be inaccuracies in the data itself; wrong bedroom counts or inaccurate and outdated square footages, all get rolled up into the Assessing Department’s assessment. Ultimately, for some properties, the valuation by the Assessing Department isn’t truly precise. This is usually the most common reason for overvaluations.

If your abatement application is based on an overvaluation, the best way to prove that is by submitting an appraisal report with your application. An appraiser will inspect your house, focus on the details of your property, pull information from the immediate market, such as sales and rentals, from nearby and similar neighborhoods, and provide a value opinion that is backed up by analysis and relevant data.

A certified real estate appraiser will provide you with a credible appraisal report to bolster your abatement application, one in which the fair market value of your house is painstakingly determined, in great detail.

At Boston Appraisal Services, we have ample experience working with municipalities and Assessing Departments across the state. We can help you by providing an accurate appraisal report for your abatement application and help you to hopefully lower your real estate taxes. Contact our offices at 617-440-7700 or orders@bostonappraisal.com