Are You Paying Too Much in Ad Valorem Real Property Taxes?

Now is the time to object to / protest your ad valorem real property adjustment.

In addition to being tax season, Spring is also the time of year that county Boards of Equalization in Alabama adjust and set real property values upon which ad valorem tax bills will be based when issued in September.

Greer B. Mallette

Many owners find that their property has been overvalued by the county as a result of the “Great Recession.” For example, the property may have been purchased for 50 percent of what it was worth five years ago in an arm’s-length transaction – yet the county continues to value the property at its last pre-recession sale price. For high-value properties ($1 million and above), this can result in additional ad valorem tax measured in the tens of thousands of dollars. Furthermore, absent a downward adjustment, this additional tax is carried over from year to year to year.

Although the county’s assessment will not be communicated until September, the valuation of the property upon which the assessment will be based is set in April or May. Therefore, the time to object is now. An owner has only 30 days to object to (protest) the assessment from the date the value is set.

The Jefferson County Board of Equalization currently expects its values to be approved and published in May. (Values in Jefferson County became official on May 16 in 2014.) In Shelby County, notices were sent out on April 9, meaning owners should submit their protests no later than Friday, May 8.

Owners in Jefferson County should be aware that they may or may not receive a notice of the current adjustment – especially if it is unchanged from the prior year. This is a trap for the unwary because the 30-day window to protest the value runs from the date the new values are approved and posted on the Board’s website and not necessarily from when a notice is sent or received.