August 15, 2015

 

By now property owners have received and if necessary protested their property valuations for both commercial real property and business personal property. If you did not receive the valuation you feel is correct through your protest efforts, be sure and remember the chance for binding arbitration.

 

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The following is a significant property tax bill from the Texas Legislature passed in the recent session that affects Texas property owners:

 

S.B. 849 was signed by Texas Governor Greg Abbott on Monday June 15, 2015, and is effective September 1, 2015. This bill dramatically improves the property tax positions for business property owners in Texas.

This bill increases the value of properties determined in an appraisal review board hearing that may be appealed to binding arbitration instead of district court. The new maximum value that can be appealed to binding arbitration is a value of not more than $ 3,000,000, and applies to both commercial real property and business personal property (inventory and equipment). A personal residence has no limit on a value that can be appealed. The old value limitation was $ 1,000,000.

The maximum cost for the maximum arbitration fee by an arbitrator (for a $ 3,000,000 property) will be $ 1,050.00; much lower than court fees.

If the arbitrator's award value is closer to the property owner’s claim of value, the appraisal district pays the fee. If the arbitrator's award value is closer to the appraisal district claim of value, the property owner pays the fee.

The claim of value is declared by the property owner when filing the request for binding arbitration. The claim of value for the appraisal district is the value determined by the appraisal review board in the protest hearing between the property owner and appraisal district.

The term "closer" is determined even by a single dollar amount. Example: The claim value of a property owner is 49,999 from arbitrator’s award value. The appraisal district’s claim value is 50,000 from arbitrator’s award value. In this case, the appraisal district pays the arbitrator's fee, and comptroller returns the property owner’s original filling fee to the property owner, less a $50 retained administrative fee.

This new law is effective September 1, 2015, so if a qualified appeal to binding arbitration is dated that date or after, the new law will apply.

As usual, there are specific details to be observed, but this is a real win for the Texas business community.

 

 

 

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And for our Men and Women that are members of any reserve component of our military forces, that is the Army Reserves, Texas National Guard, Navy Reserves, Marine Reserves, Air Force Reserves, or Coast Guard Reserves, that reside in Texas, and are called to active duty and are deployed away from home, we have a very, very special deal for you!! This special deal is for your personal residence or a business component, in case the service member owns a business. We feel you have more important items to take care of than to have the “home’ spouse contend with rising property taxes.

 

If you feel you need help in lowering values that will raise your property taxes, contact us for free analysis. If we can help, there is no fee for assisting you in lowering your values if possible. Our way of saying “Thank you” for your service!! Call for details.

 

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Do not forget about Section 41A Texas Property Code, binding arbitration for real and personal property. In checking at various appraisal districts, I find very little activity from property owners in filing for binding arbitration. The binding arbitration process is relatively quick, and uses an independent arbitrator. You may represent yourself, or have a qualified party represent you. This procedure is a very valuable tool for the property owner and should not be ignored.

 

Call us for more details on this item, as there is a time limit after the review board’s order.

 

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Specific services offered to assist you in your property tax planning include:

 

Preparation of business personal property renditions

Preparation and presentation of property protest

Preparation and representation in binding arbitration

Analysis of client’s business and training internal staff to prepare renditions

Analysis and training client to present protests to Appraisal Review Boards

Assistance in selection of arbitrator in binding arbitration hearings

Analysis of property tax issues in property acquisitions or purchases

Preparation of Schedule of Real Property Purchase Price Allocation on properties purchased

 

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Best wishes on property tax planning, and do not forget, you can receive a free property value analysis by simply contacting our office.

 

Respectfully,

 

Steve M. Spencer, CPA