FILING REQUIREMENTS FOR 2010 TAX APPEALS

N.J.S.A. 54:3-21 is the jurisdictional statute for tax appeals. It was recently amended by L. 2009, c.251, effective January 16, 2010. This amendment is noteworthy as it raises the floor for filing direct real property assessment challenges in the Tax Court. Previously, a complaint could not be filed in the Tax Court and the County Board of Taxation by passed if the assessed value exceeded $750,000.   As of January 16, 2010, the assessed value for a property must exceed $1 million to trigger the court’s original jurisdiction.    R. 8:3-5 of New Jersey’s Rules of Court were changed as of February 9th to conform.

Taxpayers are not remediless if the property’s assessment is $1 million or less. In that case, a petition, not a complaint, can be filed with the County Board of Taxation of the county in which the property is located. The procedural requirements for County Boards differ from board to board as well as with the procedural requirements of the Tax Court. However, in either forum, a taxpayer must comply with several challenges including: (1) the burden of proof on value, (2) Chapter 91, and (3) Chapter 123. Failure to comply with any of these will result in dismissal of the taxpayer’s petition or complaint, as the case may be.

 

The specifics of N.J.S.A. 54:3-21 (the “Statute”) remain the same:

 

  • A petition or a complaint must be filed on or before April 1st of the year of assessment or, on or before May 1st, if the taxing district undertook a municipal-wide revaluation or a municipal-wide reassessment.
  • The taxing district (the assessor) is required to bulk mail to each property owner a notification of the assessment and file a certification with the County Board of Taxation advising of the date the bulk mailing was completed.
  • Appeals are governed by the State Uniform Tax Procedure Law. An appeal to the Tax Court establishes jurisdiction over the entire matter with the court.
  • A cross-petition of appeal or a counterclaim can be filed within 20 days from the date of service of a petition or a complaint by the other party.

 

 

 

 

It is well established that this Statute is jurisdictional and therefore filing deadlines cannot be waived. An untimely filing will result in a dismissal of an appeal no matter how meritorious. Finally, the appeal process established by this Statute does not apply to appeals of an assessment or an exemption based on a financial agreement controlled by the Long Term Tax Exemption Law.

 

If you have any further questions, please feel free to consult Jeffrey M. Hall at (609) 895-6755 or jhall@foxrothschild.com.

Applications for Farmland Assessment DUE AUGUST 1st

The New Jersey Farmland Assessment Act of 1964 (N.J.S.A. 54:4-23.2) (“Farmland Assessment Act”) permits farmland and woodland of not less than five acres in area that is actively devoted to agricultural or horticultural use to be assessed at its productivity value, rather than the fair market value.  

The practical effect of a farmland assessment is that qualifying property owners will pay significantly less in property taxes versus the property taxes that would be levied based on the fair market value of the property. Far too often a seemingly compliant farmland property does not qualify for a Farmland Assessment because the owner did not adhere to the stringent filing and qualification criteria necessary to qualify.  Among the many criteria is a requirement that the land must be actively devoted to agricultural or horticultural uses for at least two years prior to the tax year in which the assessment is sought. Also, property owners must file annually for Farmland Assessment by completing a Form FA-1 with the municipal tax assessor prior to the August 1st deadline.  Note that an approved Farmland Assessment does not automatically renew from year to year but requires the property owner to file every year for the Assessment

Interestingly, the property owner seeking the assessment need not be the actual farmer or cultivator of the land. The Farmland Assessment Act permits an owner to rent the qualifying farmland to a farmer to cultivate agriculture and horticulture consistent with the Farmland Assessment Act. However, the use of the land for agriculture or horticultural purposes must not be haphazard even if it produces enough income to satisfy the gross sales requirement of the Farmland Assessment Act. 


The New Jersey Department of Agriculture publishes an informational guide to Farmland Assessments. See
http://www.state.nj.us/agriculture/
FarmlandAssessmentGuide.pdf
or call the Department of Agriculture at (609) 984-2503. 

Deadline to File Property Tax Appeals Extended to May 1st in Select Municipalities

In most municipalities, the deadline to file an appeal contesting a property’s assessment for property tax purposes expired on April 1, 2009. However, in those municipalities undergoing a revaluation and reassessment, the deadline to file an appeal may have been extended, in most instances until May 1st. Notice of the 2009 assessments should have been mailed on or around February 1, 2009. 

There is still time to consider the merits of filing a tax appeal to reduce your property taxes. Unfortunately, it is apparent that the trend for commercial and industrial property values continues downward. Property owners and existing tenants responsible for property taxes could be paying unfairly high property taxes. 

 

For more information, please review the following ALERT (.PDF) prepared by Fox Rothschild’s Tax Appeal Practice Group. 

 

Chapter 91 - Stealth Killer of Meritorious Commercial Tax Appeals

In a time when opportunities abound for real property tax appeals of excessive assessments, owners and tenants should pay close attention to Chapter 91 requests issued by municipal assessors. Named after a State law, Chapter 91 has claimed many a worthy appeal filed with the Tax Court and the County Boards of Taxation over the years. It is recommended that any taxpayer contemplating tax relief and seeking a reduction in property taxes for non-residential property carefully scrutinize Chapter 91 requests.

 Chapter 91, also called N.J.S.A. 54:4-34, allows a municipal assessor to mail a request to the addressee of record to complete a summary of the income and expenses for an income-producing property – the so-called I&E statement. The I&E statement is in a prescribed format; it, along with a summary or copy of Chapter 91 must accompany the assessor’s request. Failure on the part of the assessor to follow this procedure may give a taxpayer an “out.” 

An interesting part of Chapter 91 is that it applies to all properties, residential and non-residential. While it is geared to capturing information from income-producing properties, owners of owner-occupied properties must comply. Thus, it is not a defense in an otherwise meritorious action for assessment reduction and tax relief to assert that the property is not income producing – the key is whether it is capable of being an income-producing property. 

The I&E statements must be filled out completely. Incomplete requests are viewed as evasive and intended to defeat the law’s purpose of information gathering for use by the assessor to set the proper assessment for a property.

Since Chapter 91’s purpose is to collect information useful to reaching a fair and accurate assessment, an assessor uses it as a tool in their defense case in a tax appeal and/or to prevent tax appeals altogether. Failure to file an I&E statement will be permanently fatal as it will result in a dismissal of a tax appeal petition or complaint.

Opportunities to reduce real property taxes should not be overlooked in these difficult economic times as commercial property values are declining. While the deadline for filing most tax appeals is April 1st, there are other deadlines throughout the calendar year for other types of appeals. For example, May 1st is the deadline for appeals of properties in most municipalities which had a municipal-wide revaluation. Accordingly, be on the alert for the assessor’s Chapter 91 request. Even if a taxpayer failed to properly file an I&E statement in previous years, there is always an opportunity for the repair of a property’s Chapter 91 status paving the way for prospective tax relief by appeal or negotiation in a future year.