Ann Arbor property owners will begin receiving real and personal property assessed and taxable value change notices beginning March 2.
Each year, a property’s assessed value is adjusted to reflect no more than 50 percent of the property’s true cash value. For the 2021 tax year, based on real estate market sales activity through 2020, the residential class experienced an average true cash value increase of about 5 percent and the commercial class 6 percent. The industrial class remained neutral.
Regardless of an individual assessment parcel’s average market value increase, by law, an individual parcel’s 2021 “taxable value” cannot increase by more than the rate of inflation (CPI) which, for 2021, was 1.4 percent over the amount paid in 2020, except for new construction or if the property transferred ownership. It is important to understand all property tax bills are computed based on the “taxable value” not the property’s “assessed value.”
It is also important to understand that when a property transfers ownership, the taxable value uncaps and becomes the same value as the assessed value. The uncapping of taxable value occurs the year following the transfer of ownership.
An explanation of the factors taken into consideration when determining property valuations, uncapping of taxable value after a transfer of ownership, and terminology used in this process are available on the city website at https://www.a2gov.org/departments/finance-admin-services/assessing/Pages/Property%20Taxes.aspx.
The Ann Arbor 2021 Board of Review convenes Monday, March 15, through noon Thursday, March 18, to hear valuation disputes and claims for exemption. More detailed information is contained on the written notice arriving beginning March 2. Board of review appeals are by appointment or by written letter of appeal. Contact the assessor’s office to schedule an appeal hearing date and time by calling 734.794.6530.
The featured image (https://www.a2gov.org/departments/communications/PublishingImages/2021_Increase-Taxable_Value.JPG) is an example of the increase in 2021 taxable value with no new construction and no transfer of ownership.