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Property Tax Reassessments in 2021: Is Your Value Going Up or Down?

02.24.2021

In Missouri, 2021 is a property tax reassessment year. As always, this could mean an increase in your tax liability. With the added effects of the COVID-19 pandemic on property values to consider, this also means that properties could be reduced in value by the Assessor. However, whether they will be reduced enough to reflect the economic problems caused by the pandemic remains to be seen.

Regardless of what the Assessor decides, each assessment should be reviewed for accuracy in the current market because it will hold for the next two tax years. A review of your 2021 assessment will ensure you are being assessed accurately, which will keep your tax liability to a minimum.

Here are some key items to note as you await your 2021 assessment notice:

  • In Missouri, property value assessment notices will be sent out during April and May. Notices should be reviewed immediately.
  • In most Missouri counties, notices will only be sent out if the assessed value is higher than the previous value. If the assessed value is lower, or if there’s no change since the last reassessment, a notice is not required to be sent.
  • Assessments must be based on fair market value as of January 1, 2021.
  • If you have made substantial changes to a property, such as an expansion or new construction, conducting a review can be particularly prudent.
  • Many factors impact the value of a property, including age, deferred maintenance, changes in vacancy, or obsolescence. Additionally, shifts in the market or changing conditions of the surrounding neighborhood can affect a property’s value.
  • The deadline to file a formal assessment appeal in Missouri is July 12, 2021.

All business and property owners should review and appeal their property valuations annually to minimize error and achieve ideal tax results. Otherwise, one minor error could result in a disastrous outcome. For example, one wind farm was taxed for substation equipment on the personal property roll and the real estate roll for 10 years straight, costing the company an additional $1 million in tax. A simple review and appeal could have prevented that costly misstep.

Additionally, if you own property in multiple states, it’s important to be extra vigilant about your property assessments. Every state has its own property tax laws and managing property assessments in multiple states or jurisdictions can be especially challenging with differing deadlines and appeals requirements.

Property Tax Reassessment Review Success Stories

During the last property tax reassessment year of 2019, overall results for our team’s real estate appeals resulted in an average savings of 24 percent for two years, saving our clients millions of dollars.

One client, a large medical products manufacturer, was shocked to receive an inexplicably large real estate assessment increase as they had made no changes in recent years to their production facility. On appeal, we were able to prove to the Assessor that the increase was not justified and saved the taxpayer an amount equal to 46 percent of the real estate taxes due for 2019 and 2020. 

Another successful appeal was for a food manufacturing facility, which received a dramatically increased property value assessment after it converted and renovated a warehouse into a bakery and restaurant. Through the appeals process, we were able to reduce the value by over 21.5 percent. The total tax savings for our client will be $44,000.

How Brown Smith Wallace Can Help

If you own commercial property, including apartments, industrial buildings, retail or hotels, an experienced property tax consultant with local market knowledge can review your property characteristics to identify potential savings opportunities. Our property tax experts can do a short review of your assessment and work through the appeals process on your behalf, if necessary. Click here to request an assessment review today.

To learn more about real estate taxes and business personal property taxes in Missouri or other states, contact Kevin Scoles, Director of the Real Estate Property Tax practice at Brown Smith Wallace, at kscoles@bswllc.com.

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