1. Don’t be like the frog in the pot of water. You’ve probably heard the story. The frog starts off in a pot of cool water, but then someone consistently raises the heat ever so slightly over a long period of time. Before the frog realizes what is happening, it’s a goner.
Property tax bills can be this way. Everybody’s busy, and you just want to know what it’s going to cost you and that your tax burden is fair. But you could be leaving a lot of money on the table if your property is overassessed. As property owners, we get conditioned to paying higher taxes, but these increases might be unwarranted. Whenever you get a bill or notice from the county, carefully look at the assessed value, not just the tax. If you feel that your property is overassessed, consider appealing the bill.
Some larger companies are concerned that they won’t appear to be good corporate citizens if they challenge an assessment, but you should never worry about that. No one should be asked to pay more than their fair share, so reviewing and possibly appealing your assessment simply makes good business sense.
2. Tax savings deserve credit, not blame. Part of my job is to help clients find ways to reduce their assessment and, consequently, lower their property taxes. Sometimes when we propose this, a CFO or someone in the accounting department may be reluctant to go to management or a CEO about it out of a concern that they will be asked why they didn’t think about this opportunity sooner. This sort of hesitation can lead to missing out on substantial tax savings. Attorneys like me know where to look for these tax savings and are here to make CFOs and accounting professionals look good. Never allow a savings opportunity to pass.
3. Take advantage of local tax incentives. Companies planning an expansion, whether it’s real estate or equipment or both, should look for local tax incentives such as tax abatement. I frequently assist companies in this area, and find that there aren’t many lawyers who do. Even a smaller project that creates 1-2 jobs can potentially reap good benefits. In most communities, asking about tax incentives is expected. Opportunities can come from local or state officials, and I also work closely with economic development agencies in securing these benefits for our clients. Ask a seasoned tax attorney to help you find and get these incentives.
4. Coordinate with your lawyer from day one. Structuring your business to take advantage of everything available to you is smart business. Lawyers know how to do this from the ground up so you can save money. A key part of this is knowing the law and finding a creative way to apply it. Some people who are entrenched in the numbers game may not realize how a necessary expense for an asset can also be the basis for a tax exemption or other benefit, for example. An experienced, creative lawyer can help you find those opportunities and build your business success around them.