I represent retailers and other taxpayers across the state challenging their property taxes. The municipalities hire lawyers to defend them in court, and political figures speak out in the court of public opinion against them. They are often chastised for exercising their constitutional and statutory rights to challenge their taxes. Every taxpayer has these same fundamental rights. When those taxpayer challenges upset the status quo, you see “dark store” referendums across the state and proposed legislation designed to make their taxpayer challenges procedurally and substantively more difficult. The common refrain along the way is that these taxpayers are “not paying their fair share” and are “causing other taxpayers to have to pay more.” But who is really to blame?

In the words of Jules Winnfield from Pulp Fiction: Well allow me to retort.

I came across a New York Times article that once again pointed out the inequality in the property taxation system coming from nonprofit property tax exemptions. Are the “nonprofits” in your community paying their fair share? Are they true “nonprofits” that deserve to be protected and exempted from property taxes in the state?    

Ownership of residential or commercial real estate provides many benefits, but it also brings tax liabilities. Wisconsin property owners must pay property taxes every year, and these taxes are based on the assessed value of the property. However, errors are sometimes made during property tax assessment, and property owners may appeal the assessment of their property in order to reduce their tax burden.

The Assessment Appeal Process

Municipal assessors conduct assessments of properties on an annual basis, and property owners are notified if the assessment of their property changed from the previous year. If a property owner believes the assessment of his or her property’s value is not correct, he or she should first contact the assessor to review records and determine the factors that influenced the assessment.

Last December, Congress passed the Tax Cuts and Jobs Act of 2017, which was the most significant change to federal tax law in the last 30 years. This law affected nearly everyone in the United States, and financial experts are still working to fully understand the ramifications of its changes. One area that has caused some confusion is the law’s provisions for the deduction of state and local property taxes from one’s federal tax liability.

Wisconsin Homeowners Cannot Prepay 2018 Property Taxes

Prior to the passage of the new tax bill, property owners could claim an unlimited amount of state and local income and property taxes as deductions from their taxable income. However, the new law will limit this deduction to $10,000, starting in 2018. Some people have sought to take advantage of this impending change by prepaying their property taxes for 2018, allowing them to deduct taxes in excess of $10,000 on their 2017 tax return.

Max Baucus once said that “Tax complexity itself is a kind of a tax.” That statement is true in many ways.

Recently, a number of bills, Assembly Bill 386 and Assembly Bill 387, have been submitted in the Wisconsin Legislature at the behest of varying municipalities seeking to change the ways that properties are valued in this state for a specific class of property owners. These changes seek to make the use of tax valuation rules for certain properties much more complex by seeking to step outside of the valuation of the real property to include other financial data. In essence, they are seeking to complicate the state tax laws to require that certain property owners have to be separated and segmented into their own specific market rather than the general market as a whole. This runs afoul of not only common sense but also the uniformity clause of the Wisconsin Constitution.