Round Rio Rancho

For parties interested in the outcome of “tax lightning” litigation, your day may be coming. The New Mexico Court of Appeals has put two tax lightning cases onto their calendar for hearing.

If you are unfamiliar with the term, “tax lightning” occurs when someone buys a home, (often thinking that the property tax rate in effect when they purchased will continue) and at the next property tax assessment their home’s taxes are adjusted to a new and often much higher rate based upon their purchase price. On top of their shock when the taxes double or sometimes triple, imagine their indignation when they discover that their neighbors across the street (in the same model of home) are still paying one half or one third of what the new home buyer is now being billed!

Last year there were two rulings in the 2nd Judicial Court in Bernalillo County stating that parts of the property tax laws were unconstitutional. In response to these rulings, the Bernalillo County Assessor put into motion a rollback of some of the skyrocketed assessments – but only in Bernalillo County. The Sandoval County Assessor basically ignored the ruling, as the courts were not in Sandoval County. If the Court of Appeals basically affirms the lower court’s rulings, or made similar rulings of their own, the effect would be statewide.

Over 2000 lawsuits over property tax assessments are pending in Bernalillo County. State legislators are considering whether to attempt a constitutional amendment in the near future to craft a better system. The state legislature has taken up and dropped the ball on tax lightening reforms during the last two sessions. State Senator Mark Boitano has pushed workable plans in both sessions but has been blindsided by the leadership consistently.
 
There is a need for us all to pay taxes to fund public services and infrastructure, but the current property tax assessment system is broken, probably unconstitutional, and is in serious need of reform. Regardless of the outcome of cases before the Court of Appeals, if you agree that the system is broken, share your thoughts with your state representatives now, and when they go back into session.

If you own a home, are over 65 years of age with moderate income, or if you are disabled, the State of New Mexico may have a gift for you….

Under a state law revised in 2008, if you meet the above criteria you may be able to freeze the property tax valuation on your home at a lower level. Here are the particulars:

You must apply for qualification under this program each year, no later than 30 days after receiving the Notice of Valuation. After the year 2001, the applicant must be 65 or more years old (in the year the application is made). The applicant must be the owner and occupant of the property and it must be their primary residence.
 
If you are applying based upon disability instead of age, you must be blind or permanently disabled and not be expected to improve (medically).
The previous year’s modified gross income must be $32,000 or less (including all income from a spouse and dependents).

Although qualification under this program does not guarantee that your property taxes will not increase (as the mill levy rate can still adjust), the property valuation will stay the same (and that will certainly help keep the taxes down). The application is a simple, one-page form that should take 5 minutes to complete (if you have your tax return handy).