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posted: 5/9/2010 12:01 AM

Previous owner's share of property tax is paid at closing

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Q. My wife and I bought a house in McHenry County last year. We just got our tax bill and it is much higher than we thought it would be. We also did not get enough money from the seller to cover their share of the 2009 taxes. Is there anything we can do to get the seller to pay their share of the real estate taxes? Also, what can we do to reduce our bill? As we understand it, the assessed valuation on our bill should be one-third of our fair market value, but the assessed valuation on our tax bill is far greater than one-third of what we paid for the property.

A. In virtually all residential real estate transactions in this area, all real estate tax prorations are final. Unless you entered into a reproration agreement with your seller or there is some other unique element to your transaction, you cannot go back to the seller for an additional contribution toward 2009 real estate taxes.

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The good news is that you have an outstanding argument to have your 2010 (payable in 2011) real estate tax bill reduced. As a general rule, there are two arguments a homeowner can raise to reduce his assessed valuation. One is lack of conformity. In other words, a property similar to yours in the same general area is being assessed lower than you. You file a complaint to reduce your assessment and you attach to your complaint properties (usually printed off the Internet) that you deem comparable to yours yet assessed lower.

The second argument is a valuation argument. Your position is that the assessed valuation is greater than one-third of the fair market value. This can be established a number of ways but the best way is a recent sale, which you have. You file your complaint and attach a coy of your closing statement. In most cases, the assessor will adjust the assessed valuation to one-third of the recent sales price, so long as the sale was an arms length transaction. Foreclosure, bank and short sales, unfortunately, are often not considered by the assessor as being indicative of the fair market value of the property.

Look for a postcard from the assessor in late fall. You have approximately 30 days from the day you received the postcard to file your complaint. Some folks hire an attorney but the online support makes it pretty easy for anyone to accomplish this on their own.

Q. I had a guy do some work on my house a few years ago. He did a lousy job and I ended up paying him about half of what we originally agreed on. He filed a lien against my property for about $3,000.

Nothing has happened since. I am thinking of selling my house and I am worried about how the lien may affect my sale. Is there anything I can do to remove the lien from my property?

A. Stop worrying. The mechanics lien statute provides a lien must be foreclosed within two years of the date work was last done at the property. Foreclosing a lien means filing a lawsuit and serving you with the complaint.

The lien claimant declares the date work was last done in his lien. So long as two years has passed since the claimant did work at the property, the lien has no effect. Although the lien will show up in the title report, your attorney will be able to convince the title company to waive the exception.

• Send your questions to attorney Tom Resnick, 345 N. Quentin Road, Palatine IL 60067, by e-mail to tdr100@hotmail.com or call (847) 359-8983.

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