Arbitration may be best route to appeal tax board decision
Q: Last year, I received a “Notice of Forced Collections” regarding property in Gonzales, Texas, that my siblings and I thought we owned. We borrowed from a bank to pay the property taxes of more than $8,000. In December, I discovered from a surveyor that we don’t actually own the property. We tried to get our money back, but the review board at the Gonzales tax office refunded only about $1,500. We are all over 70 years old, on fixed incomes, and need our money back to repay the loan. What can we do?
A: You can appeal the review board’s decision.
It may be possible to appeal through binding arbitration, or if that option is not available, then you can sue in district court. Of course, hiring a lawyer and filing a law suit to collect $6,500 is highly impractical, so it would seem that going the arbitration route would be your better option.
The appraisal district can provide you with information regarding your rights to appeal as well as the steps that would be required.
A possible option is to hire one of the many property tax consulting firms to help you try to get your money back. They are not law firms, but they are typically better at dealing with the appraisal districts than you could ever be on your own.
Q: My 94-year old mother lives in an assisted living facility. All of her financial accounts are in a revocable trust or are payable on death to me. Her will leaves her property in three equal shares to me and my sisters. I plan to honor my mother’s wishes and divide her estate three ways. Will there be a need for probate? Will there be any tax consequence for my two sisters since I will be giving them money I will have inherited?
A: If you survive your mother, and you receive all of her assets upon her death, then there will be no need for probate. However, if you die before your mother, then some of her accounts will have no beneficiary, and that means probate would be required.
If you ultimately do make the gifts to your sisters, there will be no gift tax consequences if the gifts are less than $15,000 (or $30,000 if you are married, as your spouse can join you in making the gifts). If the gifts exceed this amount, it is probably not going to cause any issues because you can still give away an additional $11.4 million (or $22.8 million if you are married) over your lifetime without having to pay gift taxes.
The gifts your sisters receive from you are not considered to be taxable income for them.
To be safe, you should consult with an accountant or attorney before making the gifts. One or more gift tax returns may be required following your gifts.
The information in this column is intended to provide a general understanding of the law, not legal advice. Readers with legal problems, including those whose questions are addressed here, should consult attorneys for advice on their particular circumstances. Ronald Lipman of the Houston law firm Lipman & Associates is board-certified in estate planning and probate law by the Texas Board of Legal Specialization. Email questions to stateyourcase@lipmanpc.com.