In the same way that individuals do, businesses are required to pay taxes on real estate based on the value of the property itself. When you have a business that owns property, it means you are responsible for paying taxes on it. However, if you sell this real estate, the tax is split between you and the new owners, depending on the length of time you owned the property.
Real Property Tax Advisors have stated that nearly 90% of those who own commercial property are not using all the possible tax savings options that they have available. That means that you and all the other businesses in Gwinnett County are likely paying too much in commercial property tax. If you are looking for a way to drop those payments each year, we have some excellent advice to share.
Understand How Much You Are Paying
Many of the owners of commercial property consider their tax bills a part of doing business and pay little attention to the numbers. This is one of the worst mistakes you can possibly make. You need to understand what your property’s assessed value is and whether it is being taxed in an appropriate way. This might seem like common sense for a small business, but those who own lots of real estate may find watching the multiple assessments is overwhelming.
In some cases, a business owner may pay commercial property tax in installments. This makes it a bit easier to budget for the amount and ensure the cash is available on a regular basis. This can be a reasonable option, but make sure you understand the process. Sometimes you will be paying large fees for that same convenience. On the other hand, you might get a discount for paying early. If that’s the case, make sure to take advantage of the option.
Research Your Property
When you think about income tax, you likely understand that is it is a fixed expense. This is not the case when the topic is commercial property tax. Instead, this is a variable tax, and it is based solely on the market value of the building or property. Because of that, understanding every aspect of your investment is crucial.
You should be aware of the age of the property, the square footage of the building, know about any improvements that have been undertaken, and what the neighborhood is like. This gives you the ability to look over your assessment for many mistakes or outdated details that might save you money.
Learn About the Appeal Process
If you run into any error on your assessment documents or believe the value is incorrect, you will want to appeal. Every location, including Gwinnett County, has its own rules and requirements. This can make it complicated to understand what the process is and what you need to do to start the process. However, organizations like Fair Assessments LLP, provide the resources and expertise you need to move forward. It is often reasonable to contact experts to ensure you handle the process correctly from start to finish. If you end up winning the appeal, you can expect to have a lower tax requirement going forward.
Contact Your Local Tax Assessor
If you are the owner of a company with various commercial properties, it can be time-consuming and challenging to get in touch with the important individuals at your local tax offices. However, it is crucial when you want to work toward lower commercial property taxes. At the very least, it is recommended that you find out the local tax assessor for your properties and speak with them. Below are some things you should know before broaching this conversation:
- The average price that similar buildings in the area have sold for in the recent past.
- The total cost to operate your building annually in terms of both variable and fixed costs.
- The rental rates that qualify as average in your location or neighborhood.
- The capitalization rate common for the type of property you have in your location and with a similar occupancy.
Those who find that this is not possible may want to bring on the assistance of a commercial property manager to handle these tasks. This type of professional is often already working with local assessors and can easily work with them for your benefit. In addition, the expert will understand the details of your market in Gwinnett County, which makes it simpler for them to notice discrepancies that may come up in your tax bills.
Use Any Possible Exemptions and Abatements
There are many different exemptions available on commercial property. It’s merely a matter of understanding what they are and taking advantage of them. In some places, churches, nonprofit organizations, and senior housing properties are exempt from commercial property taxes in full. Some buildings that are used by specific organizations may also be exempt. Just having one of these organizations as a tenant can be a huge advantage for a commercial business owner.
Qualifying for abatements can be a bit more challenging and complicated than the process for exemptions. In most cases, you can expect an abatement in Gwinnett County if you are redeveloping or developing a property for the use of improving the local economy. If you believe that your property qualifies here, your best option is to speak to a professional who can guide you through the legal process. You can expect major savings for abatements or for exemptions.
Additional Resources and Information
For those who have further questions or concerns about lowering their commercial property taxes, you can find resources and information at Fair Assessment LLC. Our blog looks at the process of audits in various counties across the United States. We also offer a selection of videos on YouTube for business and homeowners.
If you would like to reach our staff personally, you can dial us at 404-618-0355 or email us at info@Fair-Assessments.com. We also offer a contact form on our website.
