Why You Should Appeal Your 2016 Commercial Property Tax Assessment

Posted by Anne Sheehan on Apr 26, 2016

Find out why you should appeal your business’s 2016 commercial property tax assessment.

With increased responsibilities and influence in the C-Suite, many CFOs might not even realize just how much their property tax bill for their commercial property has increased due to escalating assessments.  

If you analyzed the 2016 commercial property tax assessment of each asset in your portfolio, would you know whether or not your assessments reflect fair market value?  

Remember, commercial property tax assessments are based on the market, which is constantly moving up or down but never flat. Treating your 2016 commercial property taxes as a fixed business cost is a missed opportunity to save a lot of money.

Businesses are entitled to review and appeal their 2016 commercial property tax assessments. The government mandates that commercial property owners pay no more than their fair share of property taxes, but knowing what is fair often requires the counsel of a commercial property tax expert.  

Consider Hiring A Commercial Property Tax Expert

It is estimated that only 10-20% of businesses appeal their commercial property tax assessments, even though it is within their rights. So, why is that number so low, especially given the magnitude of the potential payoff?

It essentially boils down to a lack of time and resources on the part of company CFOs, who find themselves serving their companies in so many ways and who may not have time to navigate the commercial property tax appeals process.

The commercial property tax appeals process is cumbersome, particularly for companies who own properties in multiple states. And, even though you’re dealing with “tax,” assessments are based on market data, not information easily pulled from company financials. Given the competing demands on their time and expertise, many CFOs simply do not have the time and resources to pursue property tax appeals.

Even if your 2016 commercial property tax assessment doesn’t seem particularly high, you could benefit from having a commercial property tax expert review your portfolio.

A commercial property tax expert is best suited to provide insight into whether any property tax assessment could be lower. Additionally, an expert can recognize when a commercial property tax assessment is so far below market value that appealing could inadvertently raise an unwanted flag with the jurisdiction.

Many Factors Influence 2016 Commercial Property Tax Assessments

Dozens of factors can influence a property’s tax value year-over-year. For example, an office building may be forced to lease space to tenants at below the market rate due to an issue that’s unique to the building. If you’re leasing your office space at $30 per square foot and the average market rate is $50 per square foot, you should consider appealing your assessment in order to lower your 2016 tax bill. Or, if your occupancy level has dropped significantly over the last year, you should seek relief by filing an appeal to try and lower the property taxes on that building.

If your 2016 property tax assessments don’t factor in every variable, you risk overpaying your commercial property taxes.

There’s money to be found right within your commercial property portfolio. If you want to uncover those savings in 2016, a dedicated team of commercial property tax experts will serve you well.

Download our free whitepaper, 7 Signs You Might Be Overpaying Your Commercial Property Taxes, for more insights into the commercial property market and to learn how to identify and uncover hidden property tax savings.  


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