Filing a commercial property tax appeal is a large hurdle. To learn more about the process, please read our blog post on filing an appeal.
Unfortunately, once you’ve filed your appeal, the work isn’t over. Here are the next steps:
- Be ready to collect more data: After you’ve filed the appeal, appoint someone to follow up with the jurisdiction to determine where it is in their system. Find out if (or more likely, when) the jurisdiction expects to request any additional data from you.
Don’t underestimate the amount of data a jurisdiction will ask you for or how frequently they’ll request information. It may take you days to compile one request. If you have multiple appeals, make sure your team is prepared to handle a large influx of data requests.
Also, don’t simply collect what’s being asked of you and hand the data over. This is an opportunity to present your data in a way that’s most advantageous to your case.
- Stay in the loop: Manage your appeal to ensure it’s being processed. Sometimes tax appeals are submitted on time and then languish within the assessor’s office for years because no one follows up. After you’ve made sure your appeal is moving through the system, find out whether you’ll be able to negotiate your appeal informally or have to appear before a board for a hearing.
- Prepare for the hearing: Tax appeals boards typically consist of three to eight officials assigned to hear your case against the local taxing authority. In almost every jurisdiction in the U.S., you’ll only have between 15 and 30 minutes to make your case. That’s not a lot of time. What are you going to say? How are you going to say it? What’s your strategy?
One effective strategy employs the KISS principle. KISS is an acronym for “keep it simple, stupid,” and it serves you well when appealing commercial property taxes.
Prior to attending the hearing, find out the jurisdiction’s protocol – is the format simple with each side presenting its data and conclusions or is it a quasi-judicial format where the hearing is recorded with strict rules for order of presentation, cross-examination, rebuttal and closing?
Go to the hearing with a case fully prepared, but highlight the two most important points in your case and reemphasize them as often as possible in the allotted time.
Before the hearing, find out whether you’ll have the opportunity to cross-examine the appraiser (and whether he’ll be questioning you). To ask effective questions, you must have a deep understanding of corporate real estate, value influencers and the law.
The best possible outcome after a hearing is for the taxing authority to accept your tax value. You leave with the confirming paperwork and the jurisdiction sends a tax refund check.
But you may not receive the results of your case the same day you make your argument. Once you’ve presented your case, be prepared to follow up with the jurisdiction. You may need to be aggressive when following up. This is your money, so do what’s necessary to get it back where it belongs.
After the hearing is over, what happens if you’re not satisfied with the results? At this point, you may need to hire a real estate attorney or an appraiser to help your case. You should vet your appraiser to make sure they don’t have a conflict of interest with the opposing side.
You won’t necessarily be going to court and battling it out with the taxing authority. The courtroom is the last resort in a property tax appeal; when a property tax appeal goes to court, nobody wins. But sometimes you may need to hire an attorney and file for litigation to make it clear that you’re serious about your case. Don’t be afraid to play hardball.
As you see, a successful commercial property tax appeal isn’t as simple as walking into the assessor’s office, telling them you think you’re overtaxed and walking out with a refund.
Fortunately, with good data analysis and honed presentation skills backing you up, it’s hard not to win a commercial property tax appeal. The key is to invest time into doing research and presenting a compelling, data-driven case.
To learn more about lowering your commercial property taxes, read RPTA’s free e-book, The Corporate Taxpayer’s Guide To Reducing Commercial Property Taxes.