Alfano Law, PLLC can help reduce the assessed value of real estate when a taxpayer’s real estate is disproportionately higher than other real estate in their town or city. a taxpayer’s real estate is disproportionately higher than other real estate in the state municipality.

Because most assessments are performed on a mass basis, assessors rarely take into account features causing downward pressure on the assessed value of a particular parcel. We can help identify those features and bring them to the attention of the assessor. If an appeal is necessary, we can handle it through to its conclusion.

Alfano Law, PLLC has over thirty years experience helping clients obtain fair assessments, often resulting in refunds. This experience includes appeals on behalf of some of the largest REITS, retailers, and developers in New Hampshire and, in some cases, the country.

Alfano Law, PLLC is New Hampshire’s sole member of The National Association of Property Tax Attorneys.

Grounds for Abatement

“[A]ny person aggrieved” may request an abatement.  RSA 76:16.  This includes someone who acquires the subject real estate after April 1 but before the December tax bill comes out.  Langford v. Town of Newton, 119 N.H. 470 (1979).  The buyer is a “party aggrieved” because it receives notice of the April 1 assessment when the December bills came out.  (The closing in the Langford case was typical in that the parties prorated the real estate taxes at closing based on the prior year’s taxes.)  Please note the seller had timely filed an inventory.  The buyer, of course, did not.  This was important to the court.  If the seller had failed to file the inventory, the court still may have considered the buyer an aggrieved party, but denied the ability to maintain the appeal based on the failure to file the inventory.  In addition, a superior tax abatement appeal may be assigned and continued by the buyer of real estate.  Wise Shoe Co. v. Town of Exeter, 119 N.H. 700 (1979).

The standard is whether a particular piece of property is assessed disproportionately higher than other properties in the same municipality.  The standard is not whether the property is assessed at a value higher than fair market value, but whether it is assessed at a greater percentage of fair market value than other properties; therefore, if a parcel is assessed at a value 10% higher than fair market value and all other parcels in town are assessed at a value 10% higher than fair market value, then no grounds exist for an abatement.

The first step is to calculate what the town believes is the fair market value of the property.  This is done by dividing the assessed value by the equalization ratio.  If you can demonstrate the resulting fair market value is higher than actual fair market value, then grounds exist for an abatement.

All other properties owned by the same taxpayer in the same municipality must be included when doing this analysis.  If one property is over-assessed but another is under-assessed by an equal amount, then no grounds exist for an abatement.

In determining whether other land of the owner must be introduced for purposes of determining proportionality, the key is whether the owner is the taxpayer on those parcels.  See Appeal of City of Lebanon (February 23, 2011).  “We now clarify that when a taxpayer owns more than one parcel in any given municipality, a request for abatement on one will always require consideration of the assessment on any other parcels for which the owner is also the taxpayer.”  The key, though, is whether the taxpayer is also the taxpayer for those other parcels.  Facts of Appeal of Lebanon: taxpayer owed two lots.  One lot subject to a 75 year sublease to Walgreens (Walgreens also had the right to terminate after 25 years).  The lease was triple net and Walgreens had the right to pursue tax abatements.  The court held that the taxpayer was required only to introduce evidence of disproportionality for the lot it challenged, which was the lot not subject to the Walgreen’s lease.

The court’s ruling was quite broad and may open the door for much shorter leases.  The court did not seem to consider the length of the lease important.  In fact, it appears irrelevant.  What seems to matter is who had the obligation of paying the tax as between landlord and tenant.

Municipal Application

RSA 76:16,III requires a taxpayer to sign the municipal application. The failure of the taxpayer to sign the application gives the municipality an “independent basis” to deny the application, but the taxpayer still may appeal the decision and request review by either the BTLA or superior court on the merits. If the appeal is to the BTLA, the taxpayer must demonstrate the absence of a signature was due to “reasonable cause and not willful neglect” (Tax 203:02(d)); otherwise, the appeal will be dismissed. If the appeal is to the superior court, the court may hear the case on its merits if it determines, pursuant to applicable legal or equitable principles, the taxpayer is entitled to consideration on the merits of its application.

Owners of Properties Outside New Hampshire

If you own real estate outside New Hampshire, the National Association of Property Tax Attorneys offers a news service covering property taxes in all fifty states. The topics are sorted alphabetically by state, allowing quick access to the state or states that interest you. You also may conduct a news search by key word from NAPTA’s home page. There is no cost for this service, and you may opt out at any time. For more information on NAPTA or to sign up for the NAPTA newsletter (The newsletter sign-up is on the left-hand side of NAPTA’s home page.)

Transfer Tax Allocation

In New Hampshire, the state administers the transfer tax and municipalities administer the property tax.  Grantees are required to file a form with the Department of Revenue Administration disclosing the consideration paid and why it may not reflect fair market value.  Furthermore, the transfer tax stamps are affixed to the first page of deeds, so it is easy to determine what the parties believed the consideration to be.  This information is readily available to assessors.  Most use it, but some do not.

One disconnect between the transfer tax and the property tax is the allocation between real and personal property.  Parties sometimes are more aggressive carving out the value of personalty at the transfer tax stage, while others focus more on this issue when the time comes to challenge the property tax assessment.

A recent hot button issue in New Hampshire has been the taxability of real estate transfers to entities (usually limited liability companies) owned all or in part by the transferor.  While the statute exempts “non-contractual transfers” (gifts), the Department of Revenue Administration abruptly took the position six years ago these transfers are not gifts because the grantor receives a membership interest and limited liability in return.  The DRA began digging through its records and assessing taxes, interest and penalties on transactions most lawyers considered to be exempt.  Things have settled down, but only because most people conceded the DRA’s position; however, recent superior court decisions have scaled back the DRA’s interpretation of the statute.

Recent Laws and Rulings

BTLA vs. Superior Court

BTLA decision search page

New Hampshire Property Tax Alert