Are my property tax assessments accurate?

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by CRAIG CARDELLA

 Fact:  Sixty percent to 70 percent of property tax assessments are incorrect. Chances are yours are too.

 Why:  A tax assessor’s job is obtaining tax funds, not accuracy. They seldom review property in detail. Assessors really don’t know what your hotel is worth. They use an average value based on other property sales. Assessors are not appraisers. They lack the skills and time to value your hotel accurately.

 Solution:  Ask yourself, can I sell my property for the assessed value? Look at other area hotel values. If yours seems high in comparison, an appeal is needed. Then ask, can I deal with tax assessors? If not, seek expert help. There are tax firms that say they can handle hotels but few are truly hotel specialists. Always hire the most skilled specialists available. AAHOA is an excellent referral source for finding skilled hotel experts.

 Fact:  Property tax systems favor local governments over property owners. Getting a fair assessment is difficult. If you don’t know what to ask and how to ask, you can’t know.

 Why:  Laws and rules governing property tax are written to raise revenue not for accuracy. Most laws don’t protect your rights. States seldom have taxpayer-friendly review and appeal procedures, and few tax assessors even know their state laws and regulations.

 Solution:  Educate yourself on how property taxes are levied and collected. AAHOA is planning a series of articles, webinars and live trainings that will introduce property tax issues. There are techniques to lower taxes, but they require year-round planning and application. This is best done by hiring a skilled hotel property tax expert to keep you tax bill as low as possible.

 Fact:  Few CPAs are property tax experts. It’s likely your CPA is not skilled in property tax issues.

 Why:  Most CPAs focus on federal and state income tax, withholding and payroll taxes where failing to file correctly could cost a lot in fines and penalties. Few accounting courses teach property tax, and few accountants are skilled in hotel appraisal. Most CPAs refer property tax matters to skilled property tax experts.

 Solution:  Ask your CPA if they are property tax experts and specifically, in hotel valuation. Most will say they are not, so ask if they are willing to work with your property tax expert. Most will gladly accept what is best for your business. Follow-up regularly to be sure the work gets done.

AAHOA Board members and CEO Chip Rogers know most hoteliers pay property taxes they don’t owe. AAHOA leadership is making education available to help keep more of your revenue in your hotels. Take advantage of this effort and enjoy having move money to benefit your business and your family.     ■

Craig Cardella is CEO of Property Tax Eagle, a Founding Member of AAHOA. Craig earned a MPA degree from the University of Georgia and served in local government for many years before becoming a real estate developer and property tax consultant. Property Tax Eagle specializes in hotel property tax and related state and local tax issues. Craig will gladly answer your questions by phone or text at 229-251-7465 or email craig@propertytaxeagle.com.

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