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Show DAILY HEIALD E2 Sunday, Septembers. 2004 THE WALL STREET JOURNAL The Weekly Guide to Managing Your Money Miff. 62004 Dow Jones http'J 7sunday.wsj.com 6 Company, Inc. All Rights Reserved. Tax Break May Be Hiding in Your Home ' By Ray A. Smith Are you missing out on tax on your property? With property-tabills rising sharply in many parts of the country, it is more important than ever for homeowners to make sure their properties are assessed fairly to be ready to and accurately-a- nd challenge their assessments if necessary. It's also crucial to find but more about property-taabatement and relief programs that you may not realize are open to you, may not fully understand or may not even know about. Seniors, the disabled, veterans and people are some of the qualifying groups. But in many cases, such breaks are available to the general public. Nationwide, property taxes rose an average of more than 10 between 2001 and 2003, estimates Deloitte & Tbuche's Property Tax Services Group. In some cities, it estimates, home assessments have Some risen between 20 and of the increase stems from rising home values, but declining commercial bases have prompted many struggling local governinments to use property-tacreases to boost revenue. The mey dian price of an existing home rose to $170,000 in 2003 from $147,800 in 2001. Here, then, are some of the money-savinoptions available to many homeowners: x Getting Credit Homestead credit and exemption programs not restricted by income are -.." available in these states: Homestwo programs avaiianit I r - x . 50-- x single-famil- g Challenging an Assessment: One way to reduce your taxes is to challenge an assessment. The steps in- volved are straightforward enough that it often doesn't require hiring a lawyer or other professional. "The process itself is really geared toward homeowners being able to do it on their own as long as they are willing to put in a modest amount of tune," says Pete Sepp, a representative for National Taxpayers Union, an Alexandria, Va., citizens group. In general, property-tabills x rrrfeABh iwbwowiwi who wrangiy assessed should also find out the prices at which comparable homes in the neighborhood have been sold in the past six months. This information is . l- , m llnMAflMMAIi 71 h I, Out More To Find available through assessors, brokers or Web sites such as: " www.mortgage-x.comrepor- ....-SJf-- te Circuit-breake- ts ' hsraq.htm The International Association of Assessing Officers in Chicago offers step by step instructions on the appeals . process at wwwJaM.orgpubllcatioM unorsUndlnjmirassessmeflt.fttml Source: MRP are calculated by multiplying the assessed value of a home by the local tax rate. In some places, homes are assessed at a percentage of market value, in others at market value. So homeowners should make sure their houses are assessed at the same ratio as their neighbors'. They also should make sure the value at which their home is assessed is in line with that of similar homes in the area. Assessment data are public information and can be obtained at assessors' offices. ."If you notice a serious disparity, that may be grounds for a challenge," Mr. Sepp says. To challenge, document examples of comparable properties in the neighborhood. Also find out what criteria or factors the assessor used in coming up with a value. Make sure there are no errors in assessment, such as inaccuracies in the size, age, or condition of the property, for instance. If you find mistakes, obtain documents with the correct information. Another way to check if you're being assessed fairly is to compare it with a home appraisal; people who took advantage of low mortgage rates to refinance would have a relatively recent one on hand. Mr. Sepp says some jurisdictions require a homeowner to get a professional appraisal in order to file an assessment appeal. "I always stress to people that the very first thing to do is to learn the appeal procedure and become familiar with all the deadlines and paperwork inurements," he says. Assessments can be a bit subjective so it's worth it to challenge when you have a solid case. People who contest tax assessments can deduct expenses incurred on their federal taxes. Programs. These are administered by states or municipalities for veterans, seniors and the disabled. In some states and municipalities, homeowners claiming financial hardship or inability to pay can apply for abatements. Abatements are essentially deductions or deferproperty-tarals. They usually have income restrictions and sometimes have limits on how high the assessed value of the house can be in order to tressed neighborhoods or areas that are undergoing revitalization.' Some states and cities grant abatements to homeowners who make property improvements. In those cases, homeowners wouldn't have to pay taxes on the increased assessed value resulting from the improvements for a number of years. The applicable taxes would in effect be frozen at the pre-u- r provement assessed value of the home. The abatement period can be up to 10 years in some cases. Abatement x qualify. Sometimes abatement grants are basedon where the property is located, such as in urban enterprise zones, historic districts, dis ' - income-restricte- 1mnK.d0111anb1.c01n i exemptions. Many of the programs are open to all ages, without income eligibility requirements. Other homestead exemption and credit proare grams These for the most part are restricted to seniors, but some are open to the disabled and veterans, provided they meet the income requirements. r programs, named after the electrical devices that shut off ppwer to prevent circuits from overloading, generally come in the form of tax credits (or exemptions) that vary with income. Most of these programs are limited to low-- and moderate-incom- e homeowners and target homeowners at least 155 years old, or the disabled. Many circuit breaker programs set thresholds that property taxes can't exceed. In general, when property taxes exceed the threshold, the homeowner gets a rebate of some or all the property tax owed. State Programs. State governments offer two types of property programs, homestead circuit-breakcredits and are There also programs. homestead exemption programs, which are reductions in the amount of assessed property value subject to taxation. According to AARP, which pubrelished a report on property-talief programs last year, 14 states and the District of Columbia offer homestead credit programs, while 40 and the District of Columbia provide homestead exemptions. Indiana, Massachusetts and Mississippi offer some combination of homestead credits and homestead x " No Dive Seen In Gas Price Property Tax Deferral Programs: These allow homeowners to postpone payment of all or a portion of their property taxes until the sale of their property or death. The fixes become a lien against the value of the home. States that administer these programs (24 and the District of Columbia do) charge the homeowner interest on the amount of taxes deferred. For More Information: You can find out more about all these pro- grams and get information such as application procedures and filing deadlines through your state department of revenue or local, county or state tax commission or assessors offices. Seniors, the disabled and veterans also can learn about these programs through support and social groups or service organizations that cater to them. Tell us about your experiences with your local tax assessor. Write: fonimjunday039wsj.com prices are tailing, but don't a big break any time soon on what you pay for a gallon of gasoline. Crude oil prices have tumbled 11 from their recent peak of Oil $49.40 a barrel, to $43.99 Friday. the end of the peak summer And with Labor Day marking TIP OF THE WEEK driving season, gasoline prices would usually be expected to ease somewhat from their, current average of $1.85 a gallon. But analysts warn that this year, things could be different. Supplies remain tight, and subject to a lot of risks, such as further unrest in Iraq or Venezuela. Demand, meanwhile, shows no sign of letting up. "As long as U.S. economic growth holds up and there's a high demand for petroleum products of all kinds, it doesn't seem likely that American motorists are going to get a break on gas prices," says AAA spokesman Geoff Sundstrom. In fact, AAA's long-terforecast is for prices to trend higher through the end of the decade: "We're just using more gas." . One way to buck that trend and save yourself some money is by sharing the ride with someone else. And fortunately, carpooling is easier to arrange these days: If posting an ad by the water cooler doesn't work, several Web sites may help. At ERIdeShare.com, you can enter the city you work in and where you commute to, and see listings of people with the same commute. You then them to discuss driving together. Other sites offering services are CarpoofWorld. com and CarpoolConnect.com. All are free to use. Of course, use caution when replying to Web postings. ERideShare recommends that you meet any prospective driving buddy in a public place and ask for references and identification first. By Andrew Blaekmm INVESTOR'S CALENDAR - this ml Greenspan on the Economy: Federal Reserve Chairman Alan Greenspan testifies on the economic outlook before the House Budget Committee Wednesday. Investors will be keen to hear whether he still thinks the economic "soft patch" is temporary. HAraiTtOUfirttAtoteWgrtffHip last year, the Dow taws todusirial Averagers dowr. 1.9 so far in 2004. 15 iDJIAl Decision Time for MGM: The board of MetroGoldwyn-Maye- r could decide as soon as this week whether to accept takeover bids from Time Warner or Sony. Time Warner raised the stakes offer of last week with an h between $4.5 billion and $4.6 billion. Sony's bid is said to be slightly higher, but less than $5 billion. Markets Take a Holiday: Sorry, ' no trading on your day off. The stock and bond markets are closed tomorrow for Labor Day. Quattrone Sentencing: Former CSFB star investment banker Frank Quattrone is scheduled to be sentenced on Wednesday. The man who managed some of the biggest stock offerings of the dotcom bubble era was found guilty in May of interfering with a federal investiga- tion, and could face up to two years in jail. Measuring the Trade Deficit: Friday we'll see whether the U.S. trade deficit recovered in July from its record $55.8 billion shortfall in June. The large trade deficit was partly to blame for a recent downward revision of U.S. second-quarteconomic growth. MM THE WALL STREET JOURNAL Lawrence Rout Senior Editor David Crook Editor Brian L. Cronk News Editor - Mark Tyner Art Director 0 (809) email ninday03wq.com 4300 Route 1 North South Brunswick, NJ. 08852 Telephone: William 3 . bilLcaaeydowjoneaxom I John R. Campbell Advertising Director (2O3)S06-7DO- i i i i i i i i i 2004 '1 Soorct: TtterasoriBaMlne ; LAST WEEK Stocks An Mixed: After a 0.6 gain last week, the Dow Jones Industrial Average is less than two percentage points underwater for 2004. The Nasdaq Composite Index, which includes many technology stocks, fell 0.9 for the week and is down- - 7.9 so far this year. Search fcr tzh li.zj.ngs ; Index Funds Get Cheaper: Fidelity Investments slashed the fees on five of its stock-inde- x mutual funds to below the rates charged by rival Vanguard. Fidelity will charge just 0.10 of assets annually on the funds, down from a range of 0.19 to 0.47. Vanguard 500 Index Fund charges 0.18. iBiipiij fiiifi 1 JolmxanrpbeudowjoiieaxoBi Corporate Headquarters 200 Liberty Street New York, N.Y. 10281 For a Special Journal Subscription Offer, Call. same-stor- while rival Target's grew 1.8.... Merck was hit by a disappointing study of its cholesterol drug Income growth remained weak hi Jury, but consumer spending advanced 0.8. r:; Ycjr Resurr.o Email yz - r V : I poten1.! l J ..: c j:.; j directly to ;!jyers t J X ac - Auto Sales Slump: American consumers steered clear of sport-utilit- y vehicles in August amid surging oil prices, and auto sales overall were weak. General Motors announced a 14 sales decline from a year earlier and Ford's sales fell Briefly: Intel cut its thirdquarter forecasts, blaming weak demand for microprocessors and moves by computer makers to reduce component imentones...VvaHIart'8 Aue sales rose 0.5, gust '. f Job Growth Perks Up: Friday's jobs report showed that U.S. employers cranked up the pace of hir,: ing in August, adding a net 144,000 jobs. Jobgrowth tallies for the prior two months were revised upward; the jobless rate fell to a three-yea- r low of 5.4. . lllllllllliilt )rn petition v7 EfTY, Bill 13. E. Caaejr Jr. Vkx President. 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