STATE OF FLORIDA
Property (real estate and tangible personal property) is annually assessed at 100% of its Fair Market Value. Property taxes are determined by this value and are called ad valorem taxes. “Ad valorem” is a Latin word that means “according to value”.
The assessment is determined by general appraisal practices, which includes three valuation methods (Cost, Income and Sales Approach), enrolled by the local appraisal authority and governed by the Florida Department of Revenue.
A calendar of critical dates is as follows:
· The Assessment lien date is January 1st of each year.
· Proposed Assessments are issued in August of every year. Petitions must be filed within 25-days.
Taxpayer’s have the right to challenge these proposed figures by filing a petition with the local Value Adjustment Board (VAB) within 25 days.
The VAB is responsible for scheduling hearings, which allows the taxpayer the opportunity to present evidence to support the basis of the appeal, the fair market value.
Prior to conducting a hearing, taxpayer’s are encouraged to meet with the local appraisal authority and discuss the merits of the appeal and possibly resolve or otherwise negotiate a fair or at least reasonable assessment.
Rules that govern the exchange of evidence during the appeal process are very strict and require knowledge of the jurisdiction policies. (Dade, Broward, and Palm Beach County each have a different policy)
Taxpayer’s should consider the (8) eight factors in deriving just valuation; see F.S. 193.011.
1) The present cash value of the property;
2) The highest and best use;
3) The location;
4) The size;
5) The cost and replacement value;
6) The condition;
7) The income; and
8) The net proceeds of the sale of the property.
The appraisal authority is no longer presumed correct in its annual assessment, see HB 521.
If the assessment is determined to be fair and equitable, an appeal (petition) should not be filed with the VAB and the proposed taxes should be paid timely. Discounts for early payment of these taxes are available and could save as much as 4% for the taxpayer.