10 Reasons to Appeal Your Commercial Property Tax Assessment
Appealing your commercial property tax assessment is one of the best business decisions you can make to lower your operating costs. Property taxes can account for up to 35% of your commercial building’s operating costs in New York. There are so many important reasons to appeal your property tax assessment. Here are our 10 top reasons to grieve your taxes and how to appeal.
#1 Your taxing municipality does not have all the information they need to properly assess the real value of your commercial property. There are hundreds of factors that can affect your property values, including the condition of the property, local crime statistics, what adjacent land is used for, traffic patterns, environmental factors, exemptions, the condition of the HVAC system, market saturation. Only you, the owner or net lease tenant, know the building and property well enough to provide all the information the assessor’s office needs to take into account when estimating your valuation (the value of your property).
#2 The assessed value of your property is not the same as the market value. The only way to know what the real value of your property is and whether you have been overassessed is to work with experts in real property valuation like Realty Tax Challenge (RTC). We can give you a free consultation to determine if your property is overassessed and if you are paying too much in real estate taxes.
#3 Grievance Deadlines are annual, and so is your opportunity to grieve your commercial property taxes for that tax year. You can look up the Grievance Deadlines for New York State on our Grievance Deadlines page, or check your local municipality’s website. Your appeal needs to be prepared in advance and filed by the deadline for your local taxing municipality for your grievance to be reviewed and a possible reduction granted. If you do not file, you miss your chance for that year. It’s important to work with a consultant that will renew your grievance annually and prepare all the paperwork before the deadline. Don’t lose your chance to potentially save thousands of dollars.
#4 Property taxes in New York are some of the most expensive in the country. Property tax bills are extremely high. The pandemic has impacted commercial properties across all property types, but some sectors like retail, hotel, and office have been disproportionately affected. Property values have changed substantially in the past year, as there have been so many market fluctuations. If your assessment was completed a year ago or more, it is likely that your real property value has changed.
#5 If you want to lower your commercial property taxes, the only way to do so is to appeal the assessment. This is known as filing a tax grievance. You are asking the municipality to take another look at your assessment based on the detailed information you are providing about the property, along with reasons why your property assessment should be lowered. Your taxes are based on the assessed value multiplied by the mill rate (tax rate) for that property’s tax class. You are not appealing the taxes themselves, but you are appealing the assessment the taxes are based on. Which, if successful, will in turn lower your taxes and may even result in a tax refund.
#6 Some people may worry that appealing their property taxes feels like they are trying to get out of a community responsibility or is unethical. That is not the case. You have a legal right to grieve your assessment. As a commercial real estate owner, the taxes you pay will always go towards public schools, public utilities, roads, the local police and fire departments, and other services. However, there is no reason to pay more than your share, which can hurt your business. It is normal and extremely common to appeal your property taxes annually. Your fellow commercial business owners are likely doing the same, so you do not want to end up with an unequal share of the tax burden simply because you did not file.
#7 Your assessment and/or your tax bill can have errors. This is quite common. If you work with Realty Tax Challenge (RTC) we understand the constantly shifting laws, deadlines, and changes that affect your tax bill. We can check your bill for accuracy, and whether levies like the DAF levy in Nassau County have been applied properly.
#8 You have recently purchased a property. Getting your appeal in place immediately is important. If your purchase price is under the assessed value, you will have a strong case to lower your valuation. There are also other factors we can review to see where you can save money as the market changes quickly and the building’s last assessment may not reflect current values.
#9 Your taxes will never go up from filing an appeal. It is against NY State law for taxing municipalities to increase an assessment based on a property owner filing a grievance. The only outcome is that your assessment will stay the same or be reduced. You will never pay more. Not only that, but if you lower your assessment, the value of your property will actually increase.
#10 You do not have to pay anything unless we obtain a reduction. There are no out-of-pocket costs, so you have nothing to lose by filing and we have every incentive to save you money.
So how do you appeal? You can learn all about the appeal process in our blog Filing an appeal for your real estate taxes – what is the process? The simplest answer, however, is to contact us today so we can begin working together to obtain a property tax reduction for your commercial property right away.