With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly.
The Problem
Assessors throughout the country have a daunting task. They have to value a large number of properties in a short period of time. They use statistical models to help them determine value and the quality of these models varies from jurisdiction to jurisdiction. Additionally, the inspections of the properties are cursory since they have a large number of properties to visit. As a result, mistakes in value are common. A mistake in square footage or floor area ratio can substantially change an assessment. In our practice we have found that one-third of properties are over assessed, one-third are correct and a final third are undervalued.
For corporate property owners, it is a daunting task keeping track of property values and maintaining the lowest assessments. Many jurisdictions re-assess properties annually and with over 3,000 counties in the United States, geographically dispersed real estate creates a large administrative burden. Full-time staff is often required and that translates into higher overhead. Like any division, the real estate tax department must justify its existence. By proactively appealing tax appeals, it can do so.
It is very easy to loose a tax appeal for minor administrative mistakes. Tax appeal forms and financial documentation must be filed before the deadline, time must be invested with negotiating with the Assessor, the attorney, and others involved in the tax appeal process, appraisers often need to be selected, time must be invested for board hearings and tax court, a trail of paperwork needs to flow among all the parties, and anywhere along the line the process can become bogged down for months and even years. Knowing how to play the tax appeal game and the strategies involved is the only way to win. This series of blog articles will explore what it takes to have a successful commercial property tax appeal. Stay tuned.
John Simpson, MAI
7 responses so far ↓
1 5 Keys To Successful Tax Assessment Appeals - Six Part Series // Jun 29, 2008 at 1:40 pm
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
2 6 Keys To Successful Tax Assessment Appeals - Seven Part Series // Jun 29, 2008 at 10:02 pm
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
3 7 Keys To Successful Tax Assessment Appeals - Seven Part Series // Jun 30, 2008 at 1:29 pm
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
4 7 Keys To Successful Tax Assessment Appeals - Eight Part Series // Jun 30, 2008 at 2:34 pm
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
5 9 Keys To Successful Tax Assessment Appeals - Ten Part Series // Jul 1, 2008 at 1:51 pm
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
6 10 Keys To Successful Tax Assessment Appeals - Twelve Part Series // Jul 2, 2008 at 2:05 pm
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
7 10 Keys To Successful Tax Assessment Appeals - Twelve Part Series | Prop8 // Sep 10, 2008 at 12:15 am
[...] Keys to Successful Tax Appeals - Part 1 - With the current well-publicized real estate problems, tax appeals have become more viable for commercial property owners. The bottom line is a lower property value, yet real estate tax assessments have not been reduced accordingly. [...]
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