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Counties Need Proof To Support Taxation Valuations


As you likely know, if you or your business own property in Florida, the county will assess a property tax on your property. That tax is based on the county’s valuation of your property. In many cases, the business owner and the county may have differing opinions on what the value of property is. What many businesses don’t know is that they have a right to challenge the county’s evaluation of value. A successful challenge can lead to a significant reduction in property taxes that the business owner owes to the county.

Prior Law Made Challenges Difficult

Before 2009, it was very difficult for a property owner to challenge the county’s assessment of the value of property. That’s because all the law required was that the county use generally accepted business practices, in coming up with their valuations. That is a vague term, and courts often gave huge deference to whatever methodologies counties used.

Many counties even simply used computer programs, plugging in numbers and factors, and letting the computer calculate a value. Some used pre-determined tables.

In the meantime, business owners who challenged valuations often had real human appraisers, who looked at things like depreciation, comparatives, and other real world factors. Yet, the property owners would often lose, because of the broad discretion given to counties.

Law Changes

But in 2009, the law changed and required counties to use methods that were accepted in the appraisal profession or community.

Additionally, to win their case, the law said that all homeowners or property owners had to do was show that the valuation was wrong by a “preponderance of the evidence” (otherwise known as 51% of the evidence, the same standard used in most civil cases).

There have been cases where counties try to say that they have discretion to use whatever methodology they want to value property for the purpose of taxation, as, they argue, the law doesn’t specify how property should be appraised, other than to say counties must use professionally accepted standards.

But those arguments have been rejected. Courts do agree that counties have discretion when their valuation is challenged, but if challenged, the county must show that whatever method they used was accepted in the appraisal community. Things like putting numbers into a computer do not satisfy that requirement.

Challenges are Easier

The law changed and subsequent cases have evened the playing field between property owners and counties. Counties no longer can just use manuals, computer programs, or set formulas, but rather, must appraise property fairly, and assess each property on its own, individual merit.

It also means that a homeowner or property owner challenging a valuation can attack the way the county came up with their value, giving property owners trying to lower property tax burdens a new avenue of attack.

Are you having a governmental or regulatory problem with your business? Call the West Palm Beach business litigation lawyers at Pike & Lustig for help today.



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