How to Fight Your Property Tax Evaluation

My house went up by 400%? HOW IS THAT POSSIBLE? What can I do if my valuation seems ridiculous to me? We at the Tucker Team have helped countless clients with determining if their property tax evaluation is really ridiculous or if they really do have that much equity in their homes! We are more than happy to do the legwork that is described below for you and help you with filing a challenge. Remember that the deadline to file most challenges is either June 1 or June 8 in Colorado. Read on for more information than you ever really wanted on how to challenge a tax evaluation and what really goes into the tax calculation.

How Are Property Taxes Determined in Colorado?

In Colorado, residential property values are assessed by county assessors who use the Sales Comparison Approach to determine the value of a property. This involves comparing the property to similar properties that have sold in the same area. The assessment process takes place every 2 years, with the county assessor sending out notices to property owners with the new assessed value on May 1st.

The assessed value is used to determine the amount of property tax the owner will need to pay.

To determine the assessed value, the county assessor will look at factors such as the property's location, size, age, and condition, as well as recent sales of similar properties in the area.

They may also consider any improvements or renovations made to the property since the last assessment.

If a property owner disagrees with the assessed value, they have the right to appeal the assessment. This typically involves providing evidence of the property's value, such as a recent appraisal or information on comparable sales in the area.

What is Assessed Value? How does it compare to Market Value?

The assessed value is not necessarily the same as the market value of a property.

  • The market value is what a willing buyer would pay a willing seller for the property in an open market.

  • The assessed value, on the other hand, is used for tax purposes and may not reflect current market conditions.

Real property is revalued every odd-numbered year

  • CO reassessment years = 2023, 2025, 2027, etc.

  • Real property values are released In May

2023 values are mailed out on May 1st, 2023. 2024 value is most likely the same as 2023 value.

Even-numbered values typically only change for properties that experience new construction, demolition, change of use, re-zoning, or another change requiring reappraisal by the Assessment Division.

Residential property is valued using only the market approach to value (based on comparable sales)

The Math on Taxes

You’ve determined you want to challenge your valuation. What’s next? You (Or The Tucker Team!) will need to find comparable properties to yours. For tax years 2023 and 2024, the comparable properties must have sold between January 1st, 2021 - June 30th, 2022.

However, if insufficient data existed during that timeframe, data from each preceding 6-month period (up to a period of 5 years) may be utilized.

  • The assessor will review comparable sales (or the sale of the subject property) and use this data to determine the 2023/2024 real value.

  • Ideally, comparable sales that occurred closest to 06/30/2022 are preferred.

    • Property tax calculations consist of several components:

      • Property classification

      • Actual value of the property

      • Assessment rate

      • Assessed value

      • Mill Levy

Assessment rates are set statewide & vary between different types of properties (i.e., residential, commercial, multi-family). Mill levies are set by local governments (i.e., cities, counties, fire & police districts, water districts & special districts). They help cover the revenue needed by local governments to maintain or expand local services. Remember - The local governments are the entities that benefit from the revenue from property taxes.

So What is the Current Tax Rate?

As a result of the passage of SB21-293, and due to the failure of Proposition 120, the following changes to the statewide property tax assessment rates will take effect for tax year 2022. The passage of SB22-238 changed the assessment rates for tax years 2023, 2024 and 2025.

  • Residential real property (excludes multifamily) will be reduced from 7.15% to 6.95% for tax year 2022.

  • It will go to 6.765% for tax year 2023 along with the first $15,000 in actual value being exempted.

  • The 2024 tax year rate is UNKNOWN at this time as it will be calculated by the Colorado Division of Property Taxation.

  • It will go back to 7.15% for tax year 2025.

Example: 2022 Taxes Payable 2023

  • Residential Property

    • $750,000 Home Actual Value

    • 6.95% 2022 Assessment Rate

    • $750,000 x 6.95% = $52,125 Assessed Value

    • 83 Mill Levy (2021 State Average)

    • The homeowner owes $4,326.38 In property taxes

So there you have it. The background information on Colorado Property Taxes. Please do not hesitate to contact us if you’d like help challenging your assessment!

Market TrendsThe Tucker Team