How Texas Property Tax Protest Companies Can Help You Save Thousands!

In Texas, property taxes are a significant burden for many homeowners and business owners. Rising property values often lead to higher tax bills, leaving property owners scrambling to find ways to reduce these costs. While many turn to professional property tax protest companies to challenge their property assessments, there is another, more empowering option: doing it yourself. With the right tools, homeowners can save money and have more control over the process.

What is a Property Tax Protest?

In Texas, property taxes are based on the assessed value of your property, determined by local appraisal districts. Each year, property owners receive notices detailing the value of their property and the resulting taxes owed. Sometimes, these valuations seem unfairly high, and property owners have the right to protest the assessment. A property tax protest involves challenging the appraisal district’s value, and if successful, you could see a reduction in your tax bill.

Interestingly, data suggests that homeowners who protest their property values themselves are more likely to succeed in reducing their assessments than those who hire professional protest companies. DIY protesters not only win more often but also tend to achieve larger reductions on average.

The Role of Property Tax Protest Companies

DIY works well if you have a single family home, a duplex or a condo. Here is our guide to lowering your property's appraised value. However, if your property is commercial, industrial, agricultural, mixed-use, business personal property, multi-family etc, then navigating the protest process yourself can get complicated, which is where property tax protest companies come in. These companies specialize in representing property owners to challenge inflated property valuations. Their team of experts will file your protest, gather necessary evidence such as market trends or comparable sales, equity comps, rental income, inventory, replacement cost new et.al. and present your case at the appraisal hearing.

However, hiring a property tax protest company often comes with a significant cost. Many charge anywhere from 20% to 50% of the savings they secure for you. For some homeowners, this cost is a deterrent, as it eats into the potential tax savings. For those who prefer to take control of the process and avoid hefty fees, DIY tools like squaredeal.tax offer a cost-effective and user-friendly alternative.

How to Choose the Right Property Tax Protest Company

Not all property tax protest companies are created equal, and it’s crucial to choose one that meets your needs. Here are a few key factors to consider:

• Experience and Expertise: Choose a company with a strong track record of handling protests in your county.
• Success Rate: Ask for data on their success rate in lowering property assessments.
• Fees: Some companies charge a flat fee, while others take a percentage of the tax savings. Some take away a hefty percentage of your savings!
• Customer Reviews: Check online reviews and ask for client references.
• Communication: Ensure the company is transparent and keeps you informed throughout the process.

Are property tax protest companies worth it?

Whether property tax protest companies are worth it depends on your specific situation, goals, and comfort level with the property tax appeal process.

Pros of Hiring a Property Tax Protest Company:

1. Expertise: These companies specialize in understanding appraisal districts, local property tax laws, and the appeals process, which can save you time and effort.
2. Time-Saving: If you're busy or don't want to deal with paperwork and deadlines, these companies handle the entire process for you.
3. No Upfront Costs: Many property tax protest companies work on a contingency basis, meaning you only pay them a percentage of the tax savings they secure.
4. Negotiation Skills: Experienced agents often have relationships with local appraisal districts and know how to present a compelling case.

Cons of Hiring a Property Tax Protest Company:

1. Cost: Most companies charge 30-50% of the tax savings. Over time, this compounds and erode the benefits of appealing your property value.
2. Incentive Misalignment: Since they earn a percentage of the savings, they may focus on easy wins rather than pursuing the full potential reduction.
3. Limited Involvement: Some companies take a "one-size-fits-all" approach, filing protests based on broad market trends without digging into your specific property details.
4. Mass protests and topline reductions: Due to the volume of protests they handle, most property tax protest companies, take recourse to mass protests based on market value and Unequal appraisal only. As such your property may not get the attention it deserves.
5. DIY Protest Success Rates: Our studies suggest that homeowners often achieve larger reductions when they appeal on their own, provided they prepare adequately. Houston Chronicle and January Adivsors have also independtly arrived at the same conclusion after analyzing HCAD protest data.

When to Use a Property Tax Protest Company?

• Lack of Time or Expertise: If you’re too busy or feel overwhelmed by the process, a protest company can help.
• Complex Properties: For commercial or unique residential properties, the expertise of a professional can be invaluable.
• High Tax Bill: If your tax bill is particularly high, even a small reduction could justify the company’s fees.

When to DIY Instead

• Accessible Resources: If you have tools like Square Deal's comparable property reports, you can build a strong case yourself at a fraction of the cost.
• Willingness to Learn: The property tax appeal process is straightforward if you're willing to do some research.
• Savings compound over time: With Square Deal, you are paying a small flat fee, irrespective of the value of your property. In 2024, Square Deal customers saved an average of $1,050 in actual property tax reductions! Square Deal's reports are priced at a tenth of this or less! With a property tax protest company that keeps 50% of your savings, you would have paid them $2,500 over five years. With Square Deal reports, you will pay less than $500! That's $2,000 in your pocket!
• Your know your property best!: Nobody can represent your interests better than you. All you need is evidence to prove your claims. Once you present the assessor with the right set of comparable properties("comps"), your chance of getting a reduction instantly increases.

In sum, property tax protest companies can be worth it for busy homeowners or those with complex properties. However, if you're willing to invest time in understanding the process, DIY protesting can save you more money. The learning process is a one-time investment. Once you know it, its rinse-and-repeat year after year!

Which are the most successful Property Tax Protest Companies in Houston?

As per 2024 data, here are the top 20 most successful property tax propest companies in Harris county:

This is not an endorsement/recommendation of these companies. We have not looked at previous years to extablish a trend.

The Process of Protesting Property Taxes

Protesting your property tax assessment involves several steps:

1. Filing the protest by the deadline, usually May 15th.
2. Gathering evidence to support your claim, such as recent home sales, unequal appraisals, or property condition reports.
3. Have an informal hearing with a CAD appraiser.
4. If not satisfied with the informal hearing, attend the appraisal review board (ARB) hearing, where you present your evidence.
5. If not satisfied with ARB order, you can file for binding arbitration.

While many property tax protest companies handle all of these steps, DIY tools like squaredeal.tax equip homeowners with comparable property reports, based on unequal appraisal. With this information, you can confidently present your case and potentially save more than if you hired a professional.

The Impact of Successfully Protesting Your Taxes

A successful protest can lead to immediate and significant savings on your tax bill. In some cases, homeowners have saved thousands of dollars by simply contesting an inflated property value. These savings can be even more impactful over time, as a lower assessment affects your taxes in subsequent years.

Conclusion

If you’re a property owner in Texas, you don’t have to accept rising tax bills without a fight. DIY or engage a professional property tax protest company. But, protest for sure. You aren't going to get a reduction without protesting!