Commercial building

Two Signs You May Be Overpaying Your Commercial Property Taxes

November 15, 2017

Commercial property taxes are an unavoidable part of doing business. As an owner, you obviously don’t want to pay more than your fair share. But most you are overpaying and it is impacting your bottom line. Here’s a look at the two reasons why. 

  1. Your Payment Process is on Autopilot – Regardless of size, most companies are treating tax bills no different from everyday business. The bill arrives, it heads to accounts payable, and if the increase seems reasonable it’s paid no questions asked. This same process repeats itself year after year after year. Often small business owners or CFOs of larger companies lack the expertise to evaluate and manage property tax assessments. They don’t fully understand the approaches to market value or have time to devote to diving into the intricacies of property tax.
  2. Mass Appraisals – Overassessment of properties is more common than you may think. Assessors in both Kansas and Missouri use mandated mass appraisal techniques and market averages to estimate your property’s market value. They often make simple factual, clerical, and methodology errors. Bottom line, they don’t know the specifics of your property and they don’t have the time to really take a look. Instead, it’s lumped in with tens of thousands of properties in the same area.  If you are a real estate owner or tenant in the manufacturing, hospitality, financial services areas just to name a few - whether it is a single property or multiple, you will feel the impact. Your property may have deferred maintenance such as roof, HVAC, plumbing, etc., that may lower the taxable market value but those things are not factored in since the assessor can’t look at every asset individually.

So how can you break the cycle? To find out if your assessment is fair and equitable you need to contact a tax professional with expertise in real estate valuation who can maneuver through the regulatory obstacle course. They will examine the numbers along with the records on file with the county and come up with an opinion of the fair market value. If your property is not assessed correctly, your tax professional can help you file a property tax appeal or in some cases, you can file a “payment under protest” form with your tax bill. Both scenarios are equally complicated processes and require accuracy and adhering to strict deadlines.

Do you think you are paying too much in commercial property taxes? Contact your MarksNelson State and Local Tax Department professional at 816-743-7700 or click on the button below to schedule your free consultation.

Our clients typically receive a reduction in their property tax liability when MarksNelson appeals their real property assessment.

Schedule your FREE consultation to:

  • Determine if you should appeal
  • Find out if your assessment is based market value
  • Receive an honest appeal recommendation.

Tim Anderson is a key member of the real estate practice area at MarksNelson, leading the real estate valuation and commercial property tax appeal specialty groups. He partners with clients to secure credits and incentives, provide economic development guidance, and advise on state and local tax... >>> READ MORE

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