New Jersey Tax Appeals: Avoiding Involuntary Dismissals

dollar-sign-1317230-mOur 2016 Monmouth County Tax Board hearings are now completed. As we prepare for another batch of hearings in the remainder of the County Tax Boards, we will discuss four of the more common errors that taxpayers make that have resulted in dismissals of their matters.


  1. Refusal to Allow Access to Premises

When conducting re-assessments or revaluations, tax assessors or employees of the revaluation company may request access inspect houses. Sometimes, even in non-revaluation years, a taxpayer may receive such a request if a tax appeal is pending and the assessor needs to verify his or her information. While you certainly have the right, under the Fourth Amendment to the United States Constitution, to refuse access to government employees, you should expect that the refusal to grant access to the assessor will likely be construed as your affirmation that the assessor’s predetermined information is correct. In other words, if you want to tell the Tax Board that the property information provided by the assessor is not accurate, you should not expect too much sympathy from the Commissioners, once the assessor mentions that you refused access. Notwithstanding the Fourth Amendment, it would not be reasonable to refuse access and then show up at a tax appeal hearing to contest the findings of the assessor.

A much more difficult circumstance arises in cases when the assessor fails to give notice of his or her visit and the taxpayer is not home to let him or her into the house, or in some cases where the property is rented to a tenant, the tenant refuses access. In these cases, the taxpayer might show up to the County Tax Board hearing, completely unaware that the tax assessor is about to tell the Commissioner that access was denied. In some cases, the County will continue with the hearing with certain contingencies that access will be granted on a later date and that the tax assessor will report back to the Tax Board with his or her findings regarding any changes to the property record card. In other cases, the municipality may even ask the Tax Board to dismiss the tax appeal. In order to avoid that possibility, it is best to always grant access.


  1. Failure to Pay Taxes

We usually see at least one or two of our cases each year dismissed because the taxpayer forgot to pay municipal taxes or sewer charges. Under the law, a tax appeal cannot proceed unless all first quarter municipal charges are paid prior to the hearing date of the appeal. There are very few exceptions to this rule. Since tax appeals in Monmouth County may be heard as early as the second week of February, it is crucial that a taxpayer contact the tax collector to verify that the first quarter payment has been received, before proceeding to the tax appeal hearing.


  1. Failure to Respond to Tax Assessor’s Chapter 91 Inquiry

Owners of commercial property may be served with a request to produce a statement of income and expenses. The demand, known as a Chapter 91 request, is generally served upon the taxpayer in June of the pre-tax year.   While one of the primary indicators of value for commercial property is the income produced by the property, it is also understood that no property should be assessed based upon the income that it actually produces. Rather, the property should be assessed based upon the income that the property should be expected to produce based upon market data. An extreme example of this anomaly would be two adjacent office buildings, one of which is full, and the other one is empty. Even though a purchaser would probably pay less for the empty building, since there is no income stream, the Tax Court would have us believe that the empty building is only empty due to bad management, and therefore, it should not be entitled to a reduction of assessment. Some assessors use the Chapter 91 requests as a way of gathering market data for assessing commercial properties. But that is probably an overly optimistic view. It is far more likely, as some assessors may tell you, that the Chapter 91 requests are really just a means of easily eliminating some appeals. Procedurally, the failure to respond to a Chapter 91 within 45 days of being served with the request will result in the dismissal of a tax appeal during the following year. There is no cure for the failure to respond to the Chapter 91 request, and there is no defense either. In the event that a taxpayer is not sent a Chapter 91 request, there is no obligation to of the taxpayer to provide the income and expense information for the property, except as may be required in the discovery process.


  1. Do Not Miss the Filing Deadline
    Finally, please keep in mind that the filing deadlines are the dates upon which the Tax Board or Tax Court must receive the Tax Appeal. In Monmouth County, nearly all appeals must be filed by January 15. In all other Counties of New Jersey, as well as the Tax Court, the deadline to file an appeal is April 1.   There are a few towns each year where the deadline may be extended by a few days, due to a revaluation or late certification of the tax assessments, but you should check with the County Tax Board before assuming that any date has been extended. Please note that the deadline to file a tax appeal refers to the date upon which the Tax Board must receive the tax appeal filing. Postmark dates are not relevant. Taxpayers should bear in mind that some County Tax Boards may close as early as 4:15 P.M.

For more information on Tax Appeals, please contact our office.