1. The deadline for appealing the County’s assessment of your property’s tax value is April 9. The only exception allowed is for active Military personnel in combat zones. If you have recently acquired a property after the deadline for filing an appeal, you will not be able to appeal this year’s tax assessment on it.
2. Ninety eight percent of all property tax appeals in Maui County fail, in most cases, because the appellant did not understand the appeals process or what it takes for an appeal to succeed.
3. The key point most appeals miss is that the assessment is based on values from the previous County fiscal year. The 2010 assessments are not based on 2010 market conditions. They are based on the market as it was between July 1, 2008 and June 30, 2009. Appeals based on current market conditions will not succeed.
4. The County Code provides for four different grounds for appeals.
o A 20 percent differential between an assessment and the property’s actual market value.
o Lack of uniformity or inequality in the methods used to assess the value.
o Denial of an exemption to which the taxpayer is entitled and qualified for.
o Illegality under federal, state or county laws or ordinances.
5. In most cases, the appellant simply believes the assessment is too high. In such cases, the County Code requires that the appellant show their property was worth at least 20 percent less than what the County assessment says it was worth. So for example, to be successful, a property owner has to show that a $1 million assessment was overstated by more than $200,000 and that the property was actually worth less than $800,000.
6. While its decisions can be appealed to the State Tax Court, the County’s Board of Review is basically the judge and jury in Maui County Property Tax Appeal cases. It has the power to reduce an assessment of value, but that action has to be based on real, applicable data. The best type of data is comparable sales from the same time period. This is the same type of data licensed appraisers rely on. Your neighborhood Realtor can help you obtain that data.
7. The Board of Review has a strict five-minute rule for verbally making your appeal. However, that can be supplemented with a written statement of any length. That written statement can be a key tool in a successful appeal. The Tax Office also points out that many appeals fail simply because the necessary application is not properly filled out or the appellant fails to include the $50 (in check) appeal fee. The office will return the incomplete application to the appellant asking for more information, but by then the appeal will miss the deadline.
8. A County assessor will review an appeal before it is heard and will submit a written report on the appeal to the Board of Review. Sometimes the appeal will raise questions. Appellants are suggested to cooperate if a County assessor contacts you about your appeal. An assessor will often visit and inspect the subject property, with the owner’s permission, to get complete information.
9. Leasehold property is taxed at its base, fee simple value. While the leasehold owner does not have an interest in the land, in most cases, his leasehold agreement obligates him – and not his landlord — to pay the property taxes on the underlying land in any case. While this comes as a shock to many leasehold apartment owners, it is the way the law is written. Appeals based on the complaint that a leasehold property should not be assessed at fee simple rates will not succeed.
10. Another type of appeal that fails is one seeking an exception for missing a deadline. The only exception is for active military personnel (Maui County Code 348.556). No others are granted. Most of these appeals deal with homeowner exemptions. While you may qualify for an exemption, if you failed to file for it before the deadline (December 31) or failed to file at all, you do not have a case for an appeal. This also applies to new owners who acquired their properties after the December 31 deadline. Under the rules the Board of Review has to apply, there are no exemptions or exceptions for real property tax deadlines.
In the last couple years, as the market receded and the values fell, the Board of Review has been overwhelmed by the number of appeals. Last year alone there were over 3,400. This typically means that an appeal will take well over a year to be heard. Please do your homework. If you do not have a good case – or based on the information above, you cannot really show with solid evidence that your assessment was wrong, please do not appeal. The backlog of poorly documented appeals keeps those property owners who can show that their assessments were incorrect from getting the hearing they deserve.
View the County of Maui Real Property Assessment Appeal Brochure