Start by Checking Your Valuation
To lower your property taxes, you should check the assessor’s estimate of the market value of your property. Then compare the assessor’s value to:
- Comparable sales to determine if the assessor’s value exceeds market value, and
- The assessed value for similar properties to determine if your assessment is equitable.
Most states allow annual property tax appeals on both excessive value (assessor’s value over market value) and unequal appraisal (your assessment is high compared to neighbor’s property).
How to Reduce Commercial Property Taxes
Protest the value of your commercial property annually. Yes, protest each and every year. Even if the value did not change, protest the value. The assessor’s values are based on the cost approach, the least reliable method of appraisal. You can protest both excessive value and unequal value each year.
Protesting excessive value addresses a value in excess of market value. Valuing commercial property is difficult and reasonable people can disagree.
Protesting unequal appraisal is based on similar properties having a more favorable assessed value. Even if your assessed value is below market value, you can likely support an appeal on unequal appraisal. For example, your office building is worth $100 per square foot (PSF), assessed at $80 PSF but similar office buildings are assessed at $60 PSF. You are at a disadvantage as a landlord if your property taxes are higher than your competitors.
Protest both market value and unequal appraisal annually. It is your right and most appeals are successful.
If you need help, let O’Connor Tax Consultants help you at no upfront costs. We are experts in being able to save you money by lowering your property taxes.