How to Pay Less in Property Taxes
February 19, 2020
- Wisconsin property taxes are fifth highest in the nation
- Homeowners in Buffalo, WI get the most bang for their property tax buck
- Property tax relief credits in Wisconsin and tips for lowering your property tax bill
Property taxes have been an important part of Wisconsin’s budget since they first appeared in the state’s constitution back in 1848. They pay for the volunteers who fight our fires, the officers who police our streets, the public parks where we hang out on the weekends, and the schools that prepare our children to earn their own Paychecks.
But although Wisconsin has the fifth highest property taxes in the nation, and some homeowners may even be paying more property taxes than they should, that doesn’t seem to be enough to cover the state’s public education funding needs. The good news is that Wisconsin has a $605 million budget surplus it can use to cut personal income taxes, cut property taxes, spend on education, or figure out some combination of all three. The bad news? Lawmakers can’t agree how to spend it.
Use the Wisconsin budget surplus to cut property taxes?
Wisconsin GOP leaders want to cut personal income taxes by $250 million and business property taxes by $45 million, but Governor Evers wants to use the state’s budget surplus to increase education funding and reduce personal property taxes by $130 million. With property taxes front and center in the debate, now is a great time to understand how much you’re paying in property taxes and if there’s anything you can do on your own to lower your bill.
How are my property taxes calculated in the first place?
Property taxes don’t end when your mortgage does, so you might want to know exactly how they’re calculated over time. The amount of property tax you pay is based on two things: the value of your home and your local property tax rate. We recommend taking a minute to watch this short video that explains how property taxes are calculated. For specific questions, you can always reach out to your local tax assessor’s office.
Ways to lower your property tax bill
Evidence suggests that 25 percent of homes in America are overassessed, meaning you could be paying more in property taxes than you should be. To find out if you’re overpaying, the first step is to use this property tax calculator to determine if your home is assessed correctly. Then, follow these tips to try and lower your tax bill if you think there’s a mistake. Even if you’re not overpaying, you never know if there’s a tax credit you might be eligible for.
- Go to town hall and look for mistakes in your property record
- Let the tax assessor tour your home if possible
- Avoid upgrades right before an assessment
- Know your neighbors and their homes
- Look for possible exemptions
- Use applicable credits
Get your property tax record from town hall and look for discrepancies: you can request a reassessment if you notice any mistakes about your property’s lot size, room count, dimensions, etc. Contact your county’s property tax assessor for more information or to get instructions for how to view your records.
Invite the assessor in: if the tax assessor conducts your property tax valuation in person, consider giving him/her a tour of your home to point out any deficiencies. Some states will give you the highest assessed value possible for your type of property if you don’t grant full access to the property. The only time it’s good to have a leaky pipe or cracked ceiling is when it can help lower your home’s value during a property tax valuation!
Don’t upgrade your home or add curb appeal right before a new assessment: since property taxes increase when the value of your home increases, you may not want to renovate the kitchen or hire a landscaper to redesign your front yard right before your annual reassessment.
See if you qualify for discounts or exemptions: seniors, veterans, and other groups may be eligible for a reduction in property taxes. Wisconsin’s 2020 Guide for Property Owners outlines pretty much every exemption and credit the state offers.
What tax credits are available in Wisconsin?
Property owners in Wisconsin may qualify for several different types of credits, including a gaming and lottery credit, first dollar credit, and school levy tax credit. Owning your property as a primary residence or making an improvement to the land may qualify you for a credit. And depending on your situation, you may also be eligible for the homestead credit, farmland preservation credit, veterans and surviving spouses credit, or renters/homeowner school property tax credit.
There are several credits that can help Wisconsin homeowners pay a smaller property tax bill. Always consult a local CPA or your financial advisor to see which credits are available to you.
The bottom line
Don’t wait for a tax cut to come your way if there’s a chance you can lower your property taxes on your own. Do your research and follow the steps above to see if you can save your Paycheck a few hundred bucks this year!