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California - 06/20/2008

As the downturn continues, many institutional real estate companies including REITs are coming under increasing pressure from shareholders to achieve the returns promised on large property acquisitions that have been consummated over the past several years. With most commercial owners choosing not to market their properties, there is little relevant direct market evidence of diminution in value. This absence of solid anecdotal market evidence creates an especially difficult environment in which to appeal property taxes and instead leads to the continuation of properties being assessed at their original Proposition 13 base year acquisition values trended upward annually, by the 2% California CPI . Despite this, PTG’s California property tax team can often draw conclusions that there has been a significant deterioration in the financial performance of many office and retail properties in various markets where there are not yet sufficient open market sales indicating declining values. Click here for the complete article.

Pennsylvania – 06/15/2008

The State Tax Equalization Board has released the Common Level Ratios which will apply to property tax assessments for tax year 2009. This annual ratio change is, in essence, a revaluation of all properties in the state. Professionals from Paradigm’s Philadelphia office are prepared to perform a complimentary review of your assessment and related market value in order to determine if it is fair and equitable given the recent developments in most real estate sectors. Deadlines to appeal these assessments are August 1, 2008 or September 1, 2008 depending on class of county in which the property is located. For more information, please contact Jack Nash, Managing Consultant at (610) 409-9835 or email at jnash@paradigmtax.com.

Ohio – 05/09/2008

Utilizing the informal appeal process to reduce costs for our REIT clients’ Ohio properties may be an excellent alternative to starting the process more formally at the Board of Revision.

Click here to view the article

Texas – 05/08/2008

Most all Texas Assessors define market value to be what a willing buyer would acquire a property from a willing seller for.  It is not surprising, then, when a property transacts, the following year assessed value is at or near the purchase price.  Most property owners and Texas consultants determine nothing can be done to lower their tax burden because this is what was paid.

Texas properties are supposed to be assessed in a fee simple estate.  Thus, a property must be valued as of the annual lien date of January 1.  Most often, a purchase price is a result of “blue sky” projections resulting in a transaction more reflective of a leased fee estate.  Paradigm’s Texas practice has been very successful in pursuing reductions on average 25% below recent acquisition prices using fee simple principles along with equity.  Contact Matt Fossey, Managing Consultant, at (214) 635-4872 or mfossey@paradigmtax.com for more information.

Florida – 05/05/2008

Florida voters approved a property tax proposal (Amendment One) by state referendum on January 29, 2008.  This constitutional amendment affords some measure of relief to commercial property owners by providing a tangible personal property exemption of $25,000 and a 10% cap on valuation increases.

The 10% assessment cap will go into effect on January 1, 2009.  Historically, assessed values on commercial real estate have been below fair market value.  Assessors are working fast and furious to close this gap between historical assessments and market conditions as of January 1, 2008.  Commercial property owners should expect to see increased assessments on their 2008 TRIM Notices (proposed tax notices) received in August 2008.

Subsequent to the 2008 assessment, values can continue to increase in declining markets.   Even if the cap limits an increase in a year of growth, in subsequent years the property’s assessment will continue to rise by 10%, regardless of the actual increase or decrease in value, until the assessed value equals the just value. 

Since the 2008 value establishes the base and will have a direct impact on future property tax assessments, it is therefore imperative to have your 2008 assessed value carefully reviewed.  For more information, contact Mary Bonnell, Managing Consultant at (954) 653-1499 or mbonnell@paradigmtax.com.

Fulton County, Georgia – 04/20/2008

Following up on our news bulletin dated 4/3/2008, all Fulton County, Georgia reassessment notices have been mailed. The appeal deadline is May 28, 2008. For a review of your new assessment please contact Oscar Diaz, Director or Clifton Woodman, Managing Consultant both of the firm’s Atlanta office.

Marion County (Indianapolis) Update – 04/18/2008

Taxpayers owning property in Marion County, Indiana will finally receive their final installment of taxes that were supposed to be due in 2007. These tax bills, referred to as “reconciling statements” will likely be mailed in June with a July due date yet to be determined.

The delay in finalizing 2007 taxes was caused after The Department of Local Government Finance determined that a large percentage of commercial and industrial property assessments were not trended as required by Indiana Law. Click on the following link to view the DLGF’s order: http://www.in.gov/dlgf/retrending/Marion_County_Order.pdf

According to Tim Evans’ article Reassessment Nails Business Properties that appeared in the Indianapolis Star on March 26, 2008, Commercial property assessments increased 32% and industrial property assessments increased by 35%.

The deadline to appeal these assessments will be 45 days from the date the taxpayer is officially notified of the new value.  Paradigm Tax Group’s Indianapolis office stands ready to review the accuracy of assessments and appeal them if necessary. For more information please contact Steve Newman at 317-536-5183 or by email at snewman@paradigmtax.com. You may also contact Richard Archer at 317-250-7768 or by email at rarcher@paradigmtax.com .

National – 04/03/08

Paradigm Tax Group’s local offices constantly monitor legislative and reassessment issues. Current pressing issues for taxpayers are as follows:

  • California is currently open for proactive negotiations with the assessors regarding this year’s assessed values.
  • Marion County (Indianapolis IN), values have increase 32-35% (apartments as high as 70%). The reassessment was ordered last year by Governor Daniels and performed by county officials and a private contractor.  Value notices are due to taxpayers at this time. (see related Industry News on our website)
  • Fulton County (Atlanta, GA), will be publishing new commercial property tax notices within the next three to four weeks.  Tax assessments are expected to increase up to 40%.

Please contact any of our California offices, our Indianapolis office or our Atlanta office for more information on these or any other property tax issue you may want to discuss.

Indiana – 04/03/08

The recent reassessment in Marion County, Indiana has resulted in a 32% to 35% increase on commercial and industrial properties located within the county.  Please refer to the attached article for more information from indystar.com.  For more information and how this may impact your property taxes, please contact Richard Archer of PTG’s Indianapolis office at (317) 417-4650 or rarcher@paradigmtax.com.

Click here to view the article

Indiana – March 2008

Indiana Governor Signs Off On Significant Property Tax Reform

Governor Mitch Daniels signed into law House Bill 1001 which included numerous property tax reform provisions. Among those:

  • Elimination of the state property tax replacement credit beginning with taxes payable in 2009;
  • Eliminated inventory from the definition of personal  property thereby eliminating he requirement to report and deduct inventory values from the annual personal property tax filing;
  • Makes various changes in the appeal process;
  • Caps property taxes in most counties beginning with taxes payable in 2009 at:
    • 1.5% for homesteads;
    • 2.5% for residential property;
    • 3.5% for non-residential real property and personal property.
  • Caps property taxes in most counties beginning with taxes payable in 2010 at:
    • 1.0% for homesteads;
    • 2.0% for residential property;
    • 3.0% for non-residential real property and personal property.
  • Allows a county council to adopt an ordinance allowing a taxpayer to make installment payments for property taxes due as a result of a reconciling tax statement;
  • In order to fund certain property tax reforms, the sales and use tax rate was increased from 6% to 7% on April 1, 2008;
  • Eliminates township assessors as of July 1, 2008 in townships with less than 15,000 parcels and transfers their duties to the county assessor;
  • Requires a referendum in the 2008 general election in townships with greater than 15,000 for the elimination or retention of the township assessor;
  • Extended the deadline to file an appeal of a March 1, 2007 real property assessment to the later of July 1, 2008 or 45 days from the date a notice of assessment is sent.
You may direct any questions related to Indiana property tax reforms to Richard Archer in Paradigm’s Indianapolis office. Richard may be contacted at 317-250-7768 or by email at rarcher@paradigmtax.com.

California – 08/26/07

CALIFORNIA ASSESSMENT APPEAL DEADLINES LOOMING – SEPTEMBER 15TH AND NOVEMBER 30TH..

In California, the lien (assessment) date is January 1. The “Prop 13” real property assessed values, and the business personal property assessed values are determined as of that date. The property tax fiscal (payment) year begins 6 months later on July 1 and runs until the following June 30. The fiscal year is referred to by the first half designation. The 2007/08 tax year is commonly called the “2007” year.

With only a very few unique exceptions, the annual Prop 13 real property and business personal property assessments are only subject to appeal during a designated period. Annually, for all 58 counties, the annual regular assessment roll appeal period begins January 2nd. The appeal periods may end on either September 15th, or November 30th due to statutory notice requirements committed to by the individual counties. The county-by-county final deadlines may change from year to year. Attached, please find the county-by-county appeals deadline schedule as published by the California State Board of Equalization, the body that oversees the enforcement of property tax legislation.

For a schedule of the 2007 individual appeal deadlines, by county, see the following: www.boe.ca.gov/proptaxes/proptax.htm .

California – 06/27/07

In California, the lien (assessment) date is January 1. The "Prop 13" real property assessed values, and the business personal property assessed values are determined as of that date. The property tax fiscal (payment) year begins 6 months later on July 1 and runs until the following June 30. The fiscal year is referred to by the first half designation. The 2006/07 tax year is commonly called the "2006" year.

With only a very few unique exceptions, the annual Prop 13 real property and business personal property assessments are only subject to appeal during a designated period. Annually, for all 58 counties, the annual regular assessment roll appeal period begins January 2nd. The appeal periods may end on either September 15th, or November 30th due to statutory notice requirements committed to by the individual counties. The county-by-county final deadlines may change from year to year. Attached, please find the county-by-county appeals deadline schedule as published by the California State Board of Equalization, the body that oversees the enforcement of property tax legislation. More information can be found at www.boe.ca.gov/proptaxes/proptax.htm.

Click here to download article

Michigan – 05/29/06

Act 174 of 2006 was signed by the governor into law on May 29, 2006.  This new Act amends filing procedures and deadlines for real and personal property tax appeals.  The following changes will commence after December 31, 2006:

  1. Assessed valuation and exempt status for real property classified as commercial, industrial or developmental may be appealed directly to the Michigan Tax Tribunal without first filing a protest to the local board of review where the property is located.
  2. Assessed valuation and exempt status for personal property classified as commercial, industrial, or utility may be appealed directly to the Michigan Tax Tribunal without filing a protest to the local board of review where the property is located, if a personal property tax statement was filed before the commencement of the board of review, which may vary from jurisdiction to jurisdiction.
  3. A Petition to the Michigan Tax Tribunal is now filed timely, if postmarked by a U. S. Postal Service, delivered in person, or a designated delivery service, on or before the filing deadline expires.
  4. The filing deadline for commercial, industrial, developmental, or utility real and personal property will be May 31 of the tax year.

Texas – 01/15/06
The Texas Supreme Court ruled November 22 that local property taxes used to pay for public schools amount to an unconstitutional statewide tax and has given the state until June 1 to fix the system. Texas' highest civil court agreed 7-1 with one of three arguments brought against the state by hundreds of school districts, but found that overall school funding is adequate and that poor districts have equal access to facilities funding. Paradigm Tax Group will update this section with further information as it becomes available.

Louisiana – 01/15/06
In response to Hurricane Katrina, Louisiana has enacted legislation providing for the revaluation of flooded property (immovable and corporeal movable (i.e. real estate and tangible personal property). That is, flooded property must be revalued. Property destroyed, uninhabitable, or non-operational due to other hurricane related causes will be revalued as follows: If the local taxing jurisdictions vote to use pro-ration, the tax bill will be prorated for 2005 based on the number of days the property was "habitable". This pro-ration provision cannot be used by Jefferson, Orleans, Plaquemines, and St. Bernard. If the local taxing jurisdictions do not vote to use pro-ration and in Jefferson, Orleans, Plaquemines, and St. Bernard the property will be revalued in its damaged state for the entire year.

 
 
 

The mission of Paradigm Tax Group is to serve as a vigilant, effective and seamless extension of our client’s business operations. Click here to see what are clients are saying to that regard.

07/01/2008 - Company News
The Directors of Paradigm Tax Group are pleased to announce the opening of the firm’s Boston, Massachusetts office...Learn More
 
 
“Paradigm Tax Group, formerly the national property tax practice of KPMG, combines the national footprint and quality standards of a big 4 firm with the flexibility, and personal touch of a boutique. Our operating philosophy is national practice, local expertise and superior client service. Our goal is to become a value adding component of your organization. If you believe all property tax firms are the same, give us a try...you will be pleasantly surprised!”
 
 
   
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