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How the Assessors Determine Value
Valuation in Massachusetts is based on “full and fair cash value,” the amount a willing buyer would pay a willing seller on the open market. Assessors must collect, record, and analyze a great deal of information about property and market characteristics in order to estimate the fair market value of all taxable properties in their communities. Properties such as churches and educational institutions are also valued, even though they are exempt from taxation. The state of Massachusetts requires that all properties be reviewed every three years and that the assessed values are compared with sales statistics for the current time period. As of fiscal year 2009, Deerfield has embarked on a 9-year program and will try to inspect 12% of the properties each year. The Town of Deerfield uses an independent appraisal service to inspect properties and to analyze sales. The Assessors do not determine the amount of taxes to be raised. That is done by the voters at previous town meetings. The Assessors use the total voted appropriations, less any anticipated revenues, to establish a tax rate that will pay for the voter-approved budget.
Why Assessments Go Up When a Property Hasn’t Changed?
Since assessments reflect market value, rising/falling real estate prices in the community will result in generally higher/lower assessments. As several factors influence market value, the changes to assessments may not be uniform. One such factor is the style of the building. For example, one year, colonials will be in demand, thus raising their market value more than other styles and, another year, capes will be more popular. Another factor is location. For various reasons, certain neighborhoods are more attractive to buyers (in-town one year, rural the next...). Again, the resulting demand raises the price for homes in the preferred neighborhood. In addition, the condition of the property will affect its value. For two homes comparable in style, grade, and location, the better-maintained home will have a higher value. So, while changes made to a property can affect value, these other factors must also be considered.
What If You Disagree With the Assessed Value of Your Property?
If, in your opinion, the assessment of your property is incorrect, by all means discuss it with the Board of Assessors. At the meeting, you will need to specify the items about which you disagree: Is there some misinformation on the property record card? Do you find values of comparable properties lower or higher than yours? If so, cite specific examples. Information on all properties is available in the Assessors’ Office and on this website.
Abatements and Appeals
Once the tax bills have been mailed, an aggrieved taxpayer must go through the more formal process of filing for an abatement. These forms may be picked up at the Assessors’ Office or printed from this website. They must be filed with the Assessors within thirty days from the date the tax bills were mailed.
If the Assessors do not grant the desired abatement, the taxpayer also has the right to appeal to the State’s Appellate Tax Board. The appeal must be filed within three months of the denial. Information and applications are available on the MA Appellate Tax Board website or from:
The Appellate Tax Board
399 Washington St., 3rd Floor
Boston, MA 02108-5292
How Property Taxes Are Assessed
Before Proposition 2½ went into effect in Massachusetts in Fiscal Year 1982, the amount to be raised by the property tax in each community was essentially determined by what the community decided to spend in the coming year, either through its Annual Town Meeting, or its City and Town Council. So, budgets were determined and, then, the tax rates were set to raise that amount. With Proposition 2½ in effect, the process is reversed. The tax limitation law sets the maximum amount a community may collect, or levy, from the property tax to "...2.5 percent of the total full and fair cash value of all real and personal property in the community." Budgets must be made to fit within that limit (with the exception of any override(s) passed by the voters). At the Town Meeting, a budget is adopted. The budget total less the monies anticipated from other sources, such as state aid and local receipts from fees, etc., is the amount that needs to be raised through property taxes.
Determining the Tax Rate
Before the tax rate can be set, the Town must decide if they want all property to be taxed at the same rate, or if they prefer separate rates for a certain class of property, such as commercial/industrial. So, the Assessors prepare a Tax Rate Recapitulation sheet showing the total value for each class of property and its percentage of the town total. Using this information, the Selectboard holds a Classification Hearing to decide if there will be a single or multiple tax rate(s).
What Assessors Do Not Do
Assessors do not make the laws that affect property owners. Tax laws are enacted by the Massachusetts Legislature. Various guidelines and regulations to implement the legislation are established by the Department of Revenue. The Assessors must follow these procedures and act in accordance with the law.