The tax assessment is not the same as the value of the property. The value of the property is the dollar amount assigned to any property you own that helps determine the tax assessment. An assessor appointment by the local authorities, the county, or the state of your particular region judges the property's value. After the property's value is assessed, the tax is evaluated based on that.
The property tax assessment also considers the tax rates of the current times and the different tax exemptions that a particular property might get and then determine the value. But the property value does take these factors into consideration.
Your tax district's local real estate property assessor determines the assessed valuation of any commercial property under your portfolio. This is an annual assessment and approximation of the property's value. Its value is used by local tax authorities to determine the annual real estate taxes you must pay on your CRE properties. See the explanation of this value's calculation below.
This evaluation is applicable to both residential and commercial properties. But the commercial property tax assessment and appeal process is far more complicated and can become overwhelming for property owners.
Are you confused if the value of your property is the same as your tax assessment? How can you get the correct information? Read this piece to know more on this subject.
What is the assessed value of a property?
The assessment value of a piece of real estate is the sum allotted to it in dollars for property tax reasons. Among other things, it considers the market worth of nearby homes that are comparable. This assessed value is frequently determined as a proportion of the property's fair market value.
Each county and state have to assess millions of houses at the end of each year and get their values. Even though these processes are fair, many evaluation factors can be missed out due to the sheer volume of assessments these offices have. That is why a third-party assessment is best for unbiased opinions.
What factors help determine the assessed value of a property?
Multiple factors play a role in determining the assessed value of a property. All the factors that raise or reduce the value of your property are taken into account here. But enough physical evidence of the same must be present with the property owner. Here are the top factors that play the biggest roles,
The three primary criteria to consider are the property's position, structure, and condition. You should also take into consideration and examine the property's physical characteristics. Many parties are involved in commercial properties. However, you may also be spared if renters or tenants seriously damage your property.
There are numerous types and subdivisions of commercial real estate. Also, you should determine and comprehend whether your property was incorrectly taxed.
Check the local reference data for information on the statistics used to appraise your property. Moreover, find out if your property has been compared to any other properties; if so, which ones?
You must also cross-check with the other similar commercial properties in your area to check and see if every one of them had similar assessments. This is a fair and standard practice among tax assessors. If this process was not followed in your case, you could make an appeal.
What is the difference between the assessed and appraised values of the property?
The assessed value is the yearly estimate of the property value of any property under your portfolio. On the other hand, the appraised value is the estimate given by an expert to determine what your property is worth. Whereas the fair market value is the price, the property is expected to sell at a free market.
The property's assessed value is used by tax bodies to determine the tax bills of a property. The appraised value is used to get loans and credits against the house. But the fair price value is the real value of the house. This is done by conducting a thorough internal and external analysis of the property to determine its value.
Your commercial real estate will be valued according to fair market value by our financial experts and CMIs. By basing our assessments on the most recent phase-in methods and valuation points, we ensure you only pay the appropriate tax rate and not a penny more.
How to challenge an assessed property value if you disagree with it?
As a property owner, you get the authority to request an official review of your property's tax. Or you can opt for a third-party service to get a neutral assessment if you do not agree with the previous reports. The right to contest the assessment exists, but each county, jurisdiction, and state has a different process. For further instructions regarding how to apply for a revaluation, tax breaks, or a freeze on your real estate taxes, get in with the nearest tax authority.
According to USA News Today, when a property owner feels that their particular assessment or appraisal does not accurately reflect market value, there is an appeals mechanism in place in every state. But the logistics of the process make most commercial property owners shy away from making appeals.
Do your property tax appeal with the Assetsoft experts
You can't file your commerical taxes the regular way. Residential real estate property tax appeal is much simpler. Most people like to do it on their own to cut costs. But the appeal process can become a cumbersome process for CRE owners. That is where we can help you figure it out. When you do not agree to the property evaluations you got, talk to our tax experts so that we can do the appeal on your behalf.
We will always make sure that you only pay the taxes that are fair and just. We will also conduct an unbiased property reassessment to ensure you get the correct value. To determine the value, we will compare and analyze factors like income, management costs, sales comparison, and more.
From filing your appeal to attending hearings on your behalf, our team will be there every step of the way. Book a free consultation call with our team to know more about services to get started on the process and save money on undue tax payments.