covid-19 property taxes

COVID-19 and Your Property Taxes

The Covid 19 pandemic has really hurt the commercial values. The no travel ban was a disaster for hotels and motels, and other businesses that rely on tourism to survive.

The lack of tourism has caused serious economic and financial problems. Office buildings are struggling, restaurants have been forced to close their doors for good, and the few retail stores that haven’t closed down because they’re exclusively selling online services can barely stay afloat. It’s a tough time not just for tourist towns but also for shoppers looking to buy something new. The U.S.’s travel and hotel industries were hit especially hard during the pandemic in 2020, with 71% of US hotels saying they will not survive another six months without federal assistance from Congress.

Hotels are taxed heavily because of their high construction costs and the potential for a lot of revenue to come in over time, so they need property tax relief now more than ever.

Once, all businesses had to be located inside of an office building or strip center. Unfortunately, with the technological advancements in society and technology, those days are long gone – many companies have chosen to make their employees work from home instead of having them commute every day into the workplace.

It is becoming apparent that many business owners realize they can save money and make their employees more productive by working remotely. This will help with congestion in city centers and lower rental rates for property owners, which means negative impacts to the valuation of the real estate market could be coming soon.

We’ve all had to tighten our belts after the pandemic. This has been an especially challenging adjustment for manufacturers who already operate in one of the most highly taxed industries. Now they are forced to contend with decreased demand from customers that have slashed their production capacity. As a result, many states will continue imposing heavy real estate and personal property taxes on these capital-intensive businesses despite the difficulty of finding enough cash flow to honor debt obligations.

The solution for manufacturing businesses is often as simple as knowing exemptions or valuation allowances offered by a particular state. Many manufacturers and financial advisers may overlook these opportunities, but they’re worth exploring to maximize tax savings.

As to multi-family apartment buildings, moratoriums on residential evictions have been in effect for over one year. This has significantly affected the value of property owners and other investors’ income streams – as well as their investments.

This combination of factors may leave your commercial or multi-family real estate over-assessed. Just because the single-family real estate market is hot doesn’t mean that real estate valuations for all properties are in the same boat. Certain regions are impacted more heavily than others – and those areas are often in the highest property tax jurisdictions.

The pandemic is causing a significant negative impact on the local economy, and businesses are looking for any opportunity to save money. The tax assessors may not have realized that properties values were worth less than they thought because of the COVID epidemic, so now you can make them reduce their property taxes by documenting these losses with documentation from before the pandemic started or during its early stages.

Property taxes are a headache for everyone, and the key to getting it all right is starting early. Many localities have an April 1 deadline, but be sure that’s in your area! Find out from the tax assessor, so you don’t overpay this year and delay another 12 months next time around.