How Are Taxes Affected by Estate Appraisals?

April 11, 2018 4:53 pm Published by Leave your thoughts

Homeowners who are preparing to sell their homes often get an appraisal of the home’s value to determine an appropriate asking price. Other times, they might just be curious about the value of their house.

We often receive questions from appraisal clients about whether working with a real estate appraiser in Napa Valley, CA to secure an appraisal will cause their property taxes to increase. Fortunately, the answer is no—you don’t have to worry about an increased appraisal value leading to increased taxation on your property.

Whenever you have your home appraised, your contract with the appraisal service is only between you and the appraiser. Any report generated is created solely for your use—the appraisal service will never forward copies of that appraisal to the local government entity in charge of setting your property taxes.

So what does affect my property taxes?

There are different methods used entirely to determine property taxes. Municipalities use assessments rather than appraisals, which involve different processes.

Governing taxing entities use the assessed value of your real estate to set your property taxes. It’s quite common for local governments to send out property assessors to perform formal evaluations of all properties within their jurisdictions. The resulting assessment of your property value will determine how much you’ll pay in property taxes.

Then what’s the point of an appraisal?

So, if your property taxes aren’t affected in any way by an estate appraisal, what’s the point of having one done in the first place?

There is a variety of ways homeowners can use (and benefit from) appraisals. The most common example is homeowners who get appraisals when they put a property up for sale on the market. This will help them determine an appropriate listing price—you never want to put up a price that’s too low and give yourself no room for bargaining with potential buyers.

If you believe your property tax assessment is unfair and unfavorable, you can also file an appeal with your local government. Most property tax assessment appeal boards will not at all consider these appeals from property owners unless they have had a recent appraisal done of their property. So, if your appeal is successful, your appraisal could help lower your taxes—but it will never under any circumstances lead to an increase in the taxes you pay.

Always keep in mind that the assessed value of your property can differ greatly from the market and appraised values of the property. There are also different types of property appraisals, ranging in complexity from very basic to very thorough.

After you get your appraisal done, the appraiser will keep copies of the reports for recordkeeping purposes, so if you ever need another copy or are interested in tracking the changing value of your home over time, you will be able to ask the appraisal service for information.

For more information about the value of an appraisal for homeowners, contact County Appraisals Inc. to speak with a real estate appraiser in Napa Valley, CA today.

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