Anyone else have to go through a tax appeal hearing and have to pay back taxes on a property even for the years you didn't own it? I just purchase a 4 unit in Columbus, OH a couple of months ago. The sale triggered an alert and The Board of Education has filed a complaint against the County Auditor's tax value of the property for the last two years. The Board of Education is claiming that for the past few years it was under valued for tax purposes and The Board of Education wants their money! Apparently in Columbus the back taxes fall on the current owner and does not follow any previous owners.
I've heard from other investors that The Board of Education is doing this over and over and really hitting new investors hard. They have a team dedicated to going after back taxes. You could purchase a property and then a few months later owe another $15,000 or more in back taxes.
When I ran the numbers on the property I noticed the taxes were extremely low but I ran it with updated numbers based on the purchase price knowing that eventually there would be a re-evaluation and the taxes would go up. I had no idea that I would be responsible for the years that the County Auditors were behind on.
To me this feels like purchasing a car from someone, then the DMV all of a sudden says "Sorry, we were under charging the previous two owners the incorrect registration fees for the last few years, you now owe us thousands of dollars."
If you plan to invest in Columbus, OH pay close attention to the previous tax years and put away thousands of dollars to cover any back taxes just in case The Board of Education goes after you.
Very Interesting, lived there once and seriously considered investing there as well to add to other OH properties I already have. Nice area.
Before you purchased and noticed the bill was very low was the opportunity to have escrow/title officer review and ask the seller to pay or hold back the money to pay. This is not unique to Columbus.
Neither my agent or the escrow/title officer mentioned anything about previous years having low taxes. I have a lawyer helping me out with the case and he said the purchase contract also should have included the proration on property taxes paid by the seller should be based on the purchase price and not what they are currently paying for taxes. That would have at least helped for one year of back taxes.
@Allen Tracy , how low are we talking? Did the auditor forget a 0 or something at the end of the number?
Originally posted by @Kyle Tom :
@Allen Tracy, how low are we talking? Did the auditor forget a 0 or something at the end of the number?
They haven't changed the value in over three years through multiple sales and even permits being pulled. They've had the property at a value of $25,000 so I'd say they easily left off a 0.