As the New Year gets under way, elected officials are considering curbing or rolling back property taxes in numerous states from coast to coast. That’s good news for landowners, homeowners, and real estate investors whose properties are easy pickings for cash-strapped local governments because property taxes are one of the few revenue sources controlled at local levels.

According to The Wall Street Journal, Indiana instituted a cap on property taxes on Jan. 1. Lawmakers will further strengthen this effort by asking voters to approve a constitutional amendment that would permanently cap tax increases at 1% of a property’s value.

Although Indiana is tackling this issue most aggressively, legislatures in New York, Georgia, Oklahoma, and Wyoming are also looking at the propositions that would curb property taxes in the 2009 sessions.

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As we reported last week, the amendment will provide tax incentives to private landowners who manage their land for conservation purposes, eliminates property taxes on lands placed in a perpetual conservation easement, and give landowners financial incentives to prevent lands with wildlife habitat from being developed. The tax exemption will apply to property taxes beginning in 2010.

According to the Environment News Service,  a diverse coalition of more than 80 business groups, not-for-profits, and environmental groups supported the proposition, including the Florida Chamber of Commerce, Allied Sportsmen’s Association of Florida, Bream Fishermen Association and nationally renowned naturalist Jim Fowler, a host of the popular television program Mutual of Omaha’s Wild Kingdom.

“It’s nice to see the good guys win one for a change.’ said Eric Draper, Audubon of Florida deputy director and one of the original architects of the amendment. “And in this case, the good guys are every conservation-minded Floridian who would rather see their land used to for habitat and open spaces instead of condos and shopping centers. “The people of Florida’s support for Amendment 4 proves just how important conservation is to Floridians, and with their help, we look forward to restoring our state’s great natural abundance.” said Draper.

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I got wind of this development when I was contacted by Amy Reeves, a reporter from IBD’s Washington bureau. As I pointed out to her in the article, appraisal districts don’t operate in real time. Assessed values generally lag behind market activity, which means there’s a good possibility that your next tax assessment could be off the mark.

So what do you do if your tax bill seems too high? You file an appeal, and the basis for any effective appeal to an appraisal board is raw data. Not opinion. Not hearsay. Just the facts. Don’t get too worked up about this. It’s not rocket science. You can handle an appeal yourself. (I did.) Just dig up data on the sale of comparable properties. Or show up with figures on neighboring property that recently closed that support your position. The easiest of all? Use a current appraisal of your very own property. If you’ve just bought or just refinanced a piece of property, odds are you already have an appraisal on file. It’s by far your best bet.

But I’ve got to warn you, there’s one caveat to appealing your property taxes. The appeals process can come across as a very subective one – most boards are made up of citizens with no specialized training – but there is one hard and fast rule: the date. You must file your appeal according to the timetable that is specified in your tax assessment. This does not mean you need to have all your ducks in a row by this date; it only means that you plan to appeal. Miss the filing date, and the game is over. No ifs, ands, or buts.

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Alabamans pay on average just $477 per person in property and real taxes. That’s one of the many conclusions of this 64-page background paper from the Washington-based Tax Foundation that was released earlier this month. But you already knew that because you read this post at LandReport.com on Alabama’s low tax rates several months ago. Guess which state finished at the bottom of the list?

Way to go New Jersey: $2,642 per capita. Here’s the rundown on the states with the five lowest and the five highest property tax rates:

Lowest Property Taxes:
1. Alabama ($477)
2. Arkansas ($527)
3. New Mexico ($539)
4. Oklahoma ($562)
5. Kentucky ($620)

Highest Property Taxes:
1. New Jersey ($2,642)
2. Connecticut ($2,393)
3. New Hampshire ($2,320)
4. Wyoming ($2,175)
5. New York ($2,124)

According to the report, “Property tax collections per capita are calculated by dividing property taxes collected in each state (obtained from the Census Bureau) by population.“  (page 37)

One other conclusion worth noting:

“Real and personal property taxes are a contentious subject at the state and local levels as individuals and businesses protest rising tax bills caused by revaluations of residential and business property. In fact, the Tax Foundation’s Survey of Tax Attitudes found that local property taxes are perceived as the second most unfair state or local tax.“  (page 35)

Oddly enough, the most unfair state or local tax was nowhere identified in the report.

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