by Chris Christiaens, Special Projects
The Montana legislative session adjourned the end of April, and new laws and changes are now taking place. The current fiscal year closes on June 30th and new budgets take place on July 1.
2015 marks the first year of a new property tax appraisal cycle with property tax assessments coming in the next few weeks, if not already received by the time you read this article. As in the past, with a new property tax appraisal cycle we advise you to review it closely and as soon as it is received, as the appeal process of the new values is a short 30 days. The short version of the Department’s statement is: “…appeals procedures will allow for appeals to be filed informally with the Department through the AB-26 process, or the taxpayer can appeal directly to the County Tax Appeal Board. In either case the appeal must be filed within 30 days of the state of the assessment notice.” If as a taxpayer you file for informal review within the 30 days of the assessment notice, reduction in value will apply to both years of the cycle. If, however, you file after the 30 day deadline, any reduction of the value will apply only in the second year of the reappraisal cycle. When the department makes a decision, they will issue a notice to you. Should you fail to follow this process and wait until you receive your tax bill in November, it will be too late.
Once a decision is issued by the department and you disagree with that informal review, you have 30 days to appeal to the County Board. The County Board will then hold a hearing, which the taxpayer MUST attend. The board must consider any independent appraisal you, the taxpayer submits, if conducted within 6 months of the evaluation date and meeting the standards of the Montana Board of Real Estate Appraisers. Should the county board not use the independent appraisal, it must explain why. Within three days of the decision, the board must notify the taxpayer by mail. The decision generally will be made immediately after the hearing.
If you disagree with the county board’s decision, the taxpayer can appeal to the state board within 30 days. The Department of Revenue will be represented by attorneys at the state board. The Montana State Tax Appeal Board will only allow corporations to be represented by a corporate officer or an attorney. The state board will hold an informal hearing and issue their decision. This board is under the same obligations to consider qualified appraisals and must provide an explanation if that appraisal was not used.
Should the taxpayer be the losing party at the state board, he/she has 60 days to file a petition for judicial review with a district court, during which a business entity must be represented by an attorney. Under the Montana Administrative Procedures Act, the district court reviews the state board’s decision. A full record of all relevant information is important in this appeal process. Should the taxpayer be the losing party, it can be appealed to the Montana Supreme Court.
You might ask why this information is important, and the answer is that this was the year that all residential, commercial, agricultural and forest property was reappraised. The last valuation was done in 2008 and phased in by 2014. When you receive your reappraisal information, you may find some significant changes in the value of your property. Many houses will see significant increases even though the statewide average change in home values was slightly lower than the 2008 value. The majority of the commercial properties also will see some value increases and agricultural land, especially grain ground, will see major increases in value. Forest land meanwhile will see large decreases in value.
The legislature was aware of the changes in value, and to account for it changed the tax rates on all of the types of property. Those with average or below average increases in value will end up with lower taxable values. At the same time, those with higher than average increases in market value will have an increase in taxable value, however not as high, had the legislature not changed the tax rates.
The taxes you will owe are determined by multiplying your taxable value by the mill levies set by the taxing entities set by the state, county, schools, city and other taxing entities. It will definitely pay you to look carefully at the notice of reappraisal soon arriving in your mail.
[printed in MFU News, July 2015]
