Managing property tax expenses is a major focus for you as an owner or tenant of real property in Michigan. As the “Great Recession” in Michigan subsides and property values rebound, it is important to regularly review and monitor adjustments in your property assessments. You will shortly receive your 2015 real property tax Notice of Assessment form from the local assessor. In spite of the recent trends of increased values of commercial and industrial real property, some Michigan communities are still being assessed at higher-than-realistic taxable values or are being raised at a rate faster than market. If your property taxes have not been appealed in the last couple of years or if you recently purchased your property, you need to review your assessment today. The general rule is that property in Michigan is assessed at 50% of the True Cash Value (“TCV” or Fair Market Value). If your assessments are higher, there is an opportunity to reduce the assessed and taxable values through a tax appeal. This will often lead to significant tax savings that continue for several years at a relatively low risk.
Further, there are potential estate and succession planning opportunities while assessed values are comparatively low. Normally, transfers of real property in Michigan will result in the property taxes being “uncapped” and increase your taxable value up to 50% of the TCV. However, in today’s environment many times the taxable value and 50% of TCV are one and the same and likely to only increase in the next several years. Transfers today may provide planning benefits in future years.
The process to appeal your taxes differs. Residential property, requests to change the classification of property and appealing a denial of a charitable tax exemption all require an appeal to the March Board of Review. Property in select cities, such as the City of Detroit, must be appealed to the Board of Assessors prior to the Board of Review. Commercial and Industrial Property can, but is not required, to be appealed to the Board of Review. The deadline for the March Board of Review is listed on your Notice of Assessment.
To file a tax appeal to the Michigan Tax Tribunal on Industrial or Commercial real property, the deadline is May 31, 2015 and July 31st for Residential. Interested in a free review to determine whether an appeal of your Industrial or Commercial property would be advantageous? Want to review your planning options? Contact me NOW (and not later than April 1, 2015). My initial analysis will be completed without charge or risk to you.
Kemp Klein’s tax team represents clients that own or lease industrial or commercial real property, which includes commercial, retail including grocery, office space, engineering and manufacturing, warehousing, assisted and independent living facilities, and small business. It also represents clients in appeals of changes in the classification of real estate from industrial to commercial (which effects your personal property taxes), and applications for (or denials of) property as exempt from tax as charitable use property for nonprofit businesses.
Mr. Cnudde and the Kemp Klein tax team have significant experience working on property tax appeals. We have settled and litigated countless property tax appeals to completion. Mr. Cnudde is a DBusiness Top Lawyer for Tax Law and Non-Profit/Charities Law (2012-2014); has received an AV rating from Martindale-Hubbell Law Directory (the highest peer review rating for attorneys); has a certification in tax law; and received certification from the National Institute of Trial Advocacy (NITA) in 2006. In addition, Mr. Cnudde has been recognized as one of Michigan’s outstanding young lawyers in the area of Mergers & Acquisitions in 2013 and 2014 with a “Rising Star” designation by Michigan Super Lawyers magazine, published annually by Law & Politics.
For further information regarding these matters, please contact Mr. Cnudde at 248.740.5678 or via email.