Property taxes are one of the largest recurring costs of homeownership, yet many homeowners pay more than they legally owe. Assessment errors, unclaimed exemptions, and a reluctance to challenge assessments mean that billions of dollars in overpayments flow to local governments every year. Knowing how to review your assessment, claim available exemptions, and file an appeal can put real money back in your pocket without a lawyer or a complicated process.
How Property Taxes Work
Property taxes are calculated by multiplying your home’s assessed value by the local tax rate (the mill levy). If your home is assessed at $400,000 and the local rate is 1.2%, you owe $4,800 per year. Most jurisdictions reassess properties periodically — often every one to three years — or when the property changes hands.
The key insight is that the assessed value is an estimate, and estimates are frequently wrong. Studies by the University of Chicago and others have found that between 30% and 60% of residential properties are over-assessed in some jurisdictions. Even if your assessment is correct, you may be entitled to exemptions that reduce your taxable base.
Step 1: Review Your Assessment Notice
When you receive your property tax assessment, do not ignore it. Check the assessed value against recent sale prices of comparable homes in your neighborhood. Real estate sites like Zillow, Redfin, and your county assessor’s website show recent comparable sales. If your assessed value is significantly higher than what similar homes have recently sold for, you have grounds for an appeal.
Also review the property characteristics on your assessment: square footage, number of bathrooms and bedrooms, lot size, and any improvements recorded. Errors in these records are common and can inflate your assessment.
Step 2: Claim All Available Exemptions
Most states and counties offer property tax exemptions that can meaningfully reduce your tax bill. Common exemptions include:
- Homestead exemption. Reduces assessed value for owner-occupied primary residences. Available in most states, typically $25,000 to $50,000 in reduction. Often must be applied for — it is not automatic.
- Senior citizen exemption. Additional reductions for homeowners above a certain age (typically 65+), sometimes with income limits.
- Veteran exemption. Reductions for active military members and veterans, with enhanced benefits for disabled veterans in many states.
- Disability exemption. For homeowners with qualifying disabilities.
- Income-based freeze. Some states freeze the assessed value for seniors or low-income homeowners so it cannot rise beyond a set point.
Visit your county assessor’s website or call their office to see which exemptions apply in your jurisdiction and whether you have claimed all of them. Many homeowners leave these on the table simply because they never applied.
Step 3: File an Appeal
If your assessment appears too high after reviewing comparables and claiming exemptions, file a formal appeal. The process varies by jurisdiction but generally follows this pattern:
Know the Deadline
Appeal deadlines are strict and short — typically 30 to 90 days after your assessment notice is mailed. Missing the deadline forfeits your right to appeal for that assessment period.
Gather Evidence
Your strongest evidence is a list of three to five comparable recent sales (sold within the last six to twelve months, within a half-mile radius, similar size and features) that support a lower value. You can also hire an independent appraiser, though this typically only makes sense for high-value properties where the tax savings justify the cost.
File the Appeal
Most counties have an online appeal form or a form you can download and mail. Present your comparables clearly. Appeals are often reviewed informally first — many are resolved in your favor without a formal hearing.
Attend the Hearing if Needed
If your initial appeal is not resolved informally, you will typically be scheduled for a hearing before a local board of review or tax tribunal. Arrive with printed comparables, photos if relevant, and a concise argument. You do not need an attorney. Most hearings are brief and informal.
How Much Can You Save?
Successful appeals typically reduce assessed values by 10% to 30%, depending on the original error. On a $400,000 assessed value with a 1.2% tax rate, a 15% reduction saves $720 per year — and that savings repeats every year until the next reassessment.
The Bottom Line
Lowering your property taxes requires two actions: claiming every exemption you qualify for, and appealing your assessment if comparables support a lower value. Both are processes you can complete yourself at no cost. Given that the savings repeat annually, even a modest appeal victory pays off quickly and permanently until your next reassessment.
For other strategies that reduce the cost of homeownership, see our guide to what PMI is and how to avoid it. For understanding your home’s equity options, see what a home equity loan is.