New Jersey tax assessors often send information requests to real estate owners in their town. These requests could look like anything from a form letter to a complex form. Regardless of the form, it asks for leasing information, expense details, and particularized property descriptions. Commonly called “Chapter 91” requests, responses to these requests are time-sensitive, can affect your right to appeal your property tax assessment, and should not be ignored. I’ve counseled clients on such requests many times during my 15 years of practice in this field. Accordingly, here are a few answers to some common questions about these requests.
WHAT IS A CHAPTER 91 REQUEST?
A Chapter 91 request is made by your local tax assessor for information about your property. In general, assessors ask about how much rent you get from the property, and how much it costs to operate.
WHY AM I RECEIVING A CHAPTER 91 REQUEST?
A Chapter 91 request is supposed to help the assessor set your property’s tax assessment correctly. Because many properties are valued based on how much rent they generate, the requests focus on your income from tenants.
WHO CAN GET A CHAPTER 91 REQUEST?
Chapter 91 requests usually go to the owners of commercial property like offices, stores and apartments. It is rare for the owner of a single-family or multi-family home, or vacant land to receive such a request. However, Chapter 91 requests can be sent to any property owner in New Jersey. Thus, your appeal rights may be affected if you don’t respond in time, no matter your property type.
WHO HAS TO RESPOND TO A CHAPTER 91 REQUEST?
The law requires every owner of real estate in New Jersey to give an account of his name, property, and its income on receipt of a proper request from the tax assessor. However, the part of the law that can affect your ability to challenge your property’s tax assessment only applies to “income producing property”. This means that owner occupied property may be excused for failing to respond to a Chapter 91 request. This is true even if the property is used to make money in some other way. However, it’s not always easy to tell which category fits your situation.
HOW CAN I TELL IF MY PROPERTY IS INCOME PRODUCING?
In general, if the owner of a property occupies it and does not rent it to another person or business, the property is owner occupied. However, if the owner of the property and the business operating at the property are different, the property will not be considered owner occupied. This is true even if there is no lease, no rent paid, or if the rent is not a “market” rent. Also, even if only a small part of the property is rented, or if it is rented for only part of a year, the property is not owner occupied. If the court finds your property is income producing, even if you don’t receive rent or have a tenant, your appeal right may still be affected. When in doubt, the best option is to respond to the Chapter 91 request if you want to ensure you’ll be able to challenge your assessment.
WHEN ARE CHAPTER 91 REQUESTS SENT TO PROPERTY OWNERS?
Chapter 91 requests are usually sent in summer or fall. They could be sent any time during the year. However, the assessor must send them at least 45 days before January 10, when assessments must be finalized. Often, if the town is doing a revaluation, property owners can expect to get a Chapter 91 request in the time leading up to when the revaluation is put into effect.
HOW LONG DO I HAVE TO RESPOND TO A CHAPTER 91 REQUEST?
New Jersey law requires the taxpayer to respond to the Chapter 91 request within 45 days of the request. A late response is considered a non-response. So, if your response is received on the 46th day, you can lose your right to challenge the assessment.
WHAT HAPPENS IF I DO NOT RESPOND TO A CHAPTER 91 REQUEST?
If you own income producing property and do not respond to a Chapter 91 request within the 45-day period, you can lose the right to challenge your assessment in all but the most extreme circumstances for the tax year after the request is made. For example, if a Chapter 91 request is sent in 2022 and you fail to respond, your appeal rights for your 2023 assessment are at risk.
So, while you may still file an appeal, the town can ask the court or county tax board to limit your appeal to the “reasonableness” of the assessment. Past challenges to an assessment’s “reasonableness” have almost never succeeded.
In addition to losing your right to appeal, the law allows the assessor to use any information available to set your assessment. The result may be an excessive property tax assessment that you can’t challenge.
HOW SHOULD I RESPOND TO A CHAPTER 91 REQUEST?
The best way for you to respond to a Chapter 91 request will depend on your property’s situation. In some cases, a simple letter may be a sufficient response. In other cases, more information may be necessary, or even helpful. There can also be situations where the best response is no response.
No matter the particulars of the response, however, you should always keep a copy of the town’s request, including the envelope and a copy of your response. You should also send the response by trackable means, including delivery confirmation.
I RECENTLY CHANGED MY MAILING ADDRESS. CAN I STILL LOSE MY RIGHT TO APPEAL?
Yes. It is the taxpayer’s obligation to advise the tax assessor of a new mailing address for Chapter 91 requests.
I RECENTLY PURCHASED A PROPERTY. CAN I LOSE MY RIGHT TO APPEAL BECAUSE THE PRIOR OWNER DID NOT RESPOND TO A CHAPTER 91 REQUEST?
Yes. When a property owner fails to respond to a Chapter 91 request, it can affect a buyer’s right to challenge the next year’s assessment. If you are buying real estate in New Jersey, you should consult with your attorney to make sure that any Chapter 91 request is given a proper response.
THE CHAPTER 91 REQUEST IS ASKING FOR TOO MUCH INFORMATION! DO I STILL HAVE TO RESPOND TO A CHAPTER 91 REQUEST?
Yes. Even if the request is too broad, your appeal rights can be limited unless you, at minimum, respond to the parts of the request that aren’t objectionable and tell the assessor why you think the rest of the request is improper.
I DON’T HAVE THE INFORMATION THAT THE ASSESSOR IS LOOKING FOR; DO I STILL HAVE TO RESPOND TO THE CHAPTER 91 REQUEST?
Yes. Even if you don’t have some or all the information requested, you should still respond. For example, if the assessor requested information for the current or prior year that is not yet complete or finalized, you should still respond and provide the most recent information and explain the reason the requested information is not available.
I WASN’T ABLE TO RESPOND IN TIME. IS THERE ANYTHING I CAN DO?
Maybe. If you don’t respond at all, file a tax appeal and your town tries to have your appeal limited, it will be too late. In such a circumstance, the court found that even a property owner’s death was not sufficient justification for his elderly widow (who also suffered from Lou Gehrig’s disease) to fail to contact the assessor in the 45-day time period. However, if you just missed the deadline, the law allows a local county tax board to set terms for the property owner to provide the information if they can show good cause for failing to respond in time.
I RECEIVED A CHAPTER 91 REQUEST AND I’M NOT SURE HOW TO RESPOND, OR EVEN IF I SHOULD RESPOND. WHAT DO I DO?
If you’ve received a Chapter 91 request, you should contact an attorney experienced in property taxation. The Englert Law Firm, LLC uses its experience opposing motions involving Chapter 91 to help clients craft the most effective responses. We can help you decide whether it is in your best interest to respond, and how best to respond.
A classic spot assessment is the reassessment of a single recently-sold property that isn’t part of a larger scale reassessment or municipal-wide revaluation.
It is Illegal!
Spot assessments are illegal in New Jersey because the state constitution requires uniform treatment in taxation. In general, reassessments must be performed on all properties as part of a larger reassessment cycle, or else because a single property has been significantly improved upon, to comply with this constitutional requirement. However, when the assessor increases the assessments of only a handful of recently sold properties, he or she has violated this constitutional requirement, and you can seek relief from the increase.
There are unscrupulous assessors who try to take advantage of people’s unfamiliarity with the nuances of the law – it can happen. This is a particular problem in a market where values are rising, as assessors may be tempted to target the low-lying fruit of recently sold property instead of implementing a town-wide reassessment or revaluation.
Assessors may also try to justify the assessment increases because of property improvements. However, minor cosmetic updates such as tidying the landscaping, painting the exterior, fixing a broken shutter, re-hanging a fallen gutter, etc., shouldn’t trigger an increase as no significant improvements were made that would increase property value. However, it still happens!
If you believe your property has been unfairly singled out for an assessment increase, it’s important to contact an attorney immediately who can evaluate your case and secure your right to appeal as it may be impossible to overturn an improper increase otherwise.
And if you were part of a town-wide revaluation, but are concerned or dissatisfied with the new figure, you may still be able to appeal. I provided an overview of the appeal process in this previous blog post. Also, the state of New Jersey has published this pamphlet with some property tax FAQs for property owners, which may be helpful as you review your recent revaluations.
For almost 15 years, I’ve obtained hundreds of millions of dollars in assessment reductions for my clients. I offer a complimentary assessment review to determine your eligibility to appeal. If you decide to go through with filing an appeal, you will receive my personal attention from start to finish as I strive to obtain the best result possible. Contact me with any questions or to schedule a consultation.
It’s that time of year again. If you haven't already, you will be receiving your New Jersey Property Tax Assessment postcard from your local tax assessor. Keep an eye open for it – it looks something like this:
If you do not receive a postcard or misplace it, you can contact your municipality for a replacement.
What Does the Postcard Say?
The postcard tells you the assessed value of your property. Your municipality calculates how much you owe in property taxes using your assessment and the local property tax rate. The assessment is just the local tax assessor’s opinion of your property’s value. Because many factors affect a property's value, assessments can often be wrong. When the assessment is incorrect, all property owners (and some tenants) have the right to file an appeal. Your assessment can also be misleading because it may only represent a fraction of the estimated market value.
What if I think my assessment is wrong?
Again, you have the right to appeal your assessment. In fact, you may appeal your property's assessment every year. Therefore, depending on the property's assessed value, you may file an appeal at the County Tax Board or in New Jersey Tax Court. The taxpayer must supply the County Tax Board with sufficient evidence to determine the property's true market value.
Once the Tax Court or County Tax Board determines the property's true value, it must compare the property's true value to the assessed value. Depending on the municipality, it could be a direct comparison, or it could involve using the town’s average ratio of assessed value to true value, which is determined by the New Jersey Division of Taxation for every town, every year.
And don't forget the deadline to file a property tax appeal in most of New Jersey is April 1, 2022.
Here to Help
For almost 15 years, I've worked to reduce my client’s tax assessments. I’ve obtained hundreds of millions of dollars in assessment reductions for my clients. If an appeal is right for you, you will receive my personal attention from start to finish, and I will strive to obtain the best result possible. So, call me with any questions or to receive a complimentary assessment review to determine if you can benefit from a tax appeal.