Unequal Appraisal

In many states including Texas, if a property trades, the purchase price becomes the new assessment. Clearly this is not fair or equitable because properties which did not sell remain unchanged or are not raised to the level of the property which sold. A property tax appeal was filed calming unequal appraisal in 1998. This appeal ultimately ended up in the Fourteenth Court of Appeals in 2001. After hearing the position of the Harris County Appraisal District and United Investors Realty Trust the court ruled in favor of the Taxpayer. The court upheld Section 42.26 (d) of the Texas Property Tax Code, which says; “The district court shall grant relief on the ground that a property is appraised unequally if the appraised value of the property exceeds the median appraised value of a reasonable number of comparable properties appropriately adjusted.”

After the United Investors case some appraisal districts believed that taxpayers could only get relief based on an unequal appraisal appeal through litigation. The Legislature sought to clarify this issue in 2003 through Section 41.23. Protest of Inequality of Appraisal paved the way for taxpayers to seek relief administratively.

Today appeals based on unequal appraisals are universally accepted by Texas appraisal districts. However, there still remain technical interpretations of the calculations of “median value.” For the most part appeals based on unequal appraisal are an effective means for taxpayers to limit tax liabilities and secure fair and equal assessments.