More on Property Tax Appeals
Last week, we stressed the importance of evaluating, and potentially appealing, property tax assessments. After an assessment notice is sent out, there is usually a short window for a property owner or their representative to file an appeal. The appeal process, for the most part, is a three-tiered process:
When appealing an assessment, there are three approaches to determine the value of real estate:
- Cost: The estimated material and labor costs needed to replace a building with a similar one. If the building was not recently constructed, the cost must consider all forms of accrued deprecation present.
- Market: The predicted price a property would bring on the open market in a transaction between a willing, informed, and knowledgeable buyer and seller, using sales of other like properties, in order to determine the value.
- Income: The consideration of typical income and expenses, along with financial returns, a buyer would expect for a certain property type.
Our property tax team, led by Jack Schindler, utilize these valuation approaches and other metrics to ascertain whether a property might have been overvalued by an assessor. Our team will work directly with the assessor to negotiate a reasonable property value.
- Carey M. Heyman, CPA
- Managing Principal of Industry - Real Estate
- CliftonLarsonAllen LLP
- Century City (Los Angeles)
Carey is the Managing Principal of the Real Estate Industry at CLA. He is a trusted advisor with close to 20 years of experience providing accounting, assurance, tax, and consulting services to real estate industry owners, operators, family offices, developers and syndicators. Carey has a strong track record of helping clients build and retain capital by leveraging tax- and cost-saving strategies and employing tax credits and incentives. He also consults with high net worth individuals, large family groups, and owners of closely-held businesses on all aspects of tax planning, estate planning, and retirement planning.
Comments are closed.