Posted on April 1st, 2023.

As a business owner, you know that taxes are an inevitable part of doing business. One type of tax that often gets overlooked, however, is property taxes. Property taxes are taxes on the value of the real estate, including land, buildings, and other improvements. These taxes are levied by local governments and are typically based on the assessed value of the property. In this blog post, we will explore how property taxes are calculated, how they can negatively impact your business, and how Reed Advisory Group can help you mitigate some of your property taxes to improve your bottom line.

How Are Property Taxes Calculated?

Property taxes are calculated based on the assessed value of the property, which is determined by the local government. The assessed value is usually a percentage of the market value of the property, and it can vary depending on the location, size, and condition of the property. Once the assessed value is determined, the local government applies a tax rate to that value to calculate the property tax owed.

There are a few different factors that can impact the assessed value of a property. One of the most significant factors is the local real estate market. If property values in the area are rising, the assessed value of your property may increase as well. Additionally, any improvements or renovations made to the property can also increase the assessed value and property taxes.

It's important to note that property tax rates can also vary depending on the location. Some areas may have higher property tax rates than others, and these rates can change from year to year. As a business owner, it's important to stay informed about property tax rates and any changes that may impact your expenses.

How Property Taxes Negatively Impact a Business?

Property taxes can be a significant expense for businesses, especially those with large properties or in areas with high tax rates. High property taxes can eat into a business's profits and make it more difficult to invest in growth or to compete with other businesses. In some cases, property taxes can be a major factor in a business's decision to relocate to a different area with lower tax rates.

In addition, property taxes can also be impacted by local laws and regulations, such as tax incentives or exemptions for certain types of properties or businesses. These laws can affect the assessed value of a property and the tax rate applied to that value, leading to variations in property tax amounts across different locations and property types.

Understanding how property taxes are calculated and the local laws that affect them is crucial for businesses looking to optimize their expenses and improve their bottom line. Working with a property tax consultant like Reed Advisory Group can help businesses navigate the complex landscape of property taxes and identify opportunities for cost savings and tax mitigation. 

How Reed Advisory Group Can Help You Mitigate Some of Your Property Taxes?

At Reed Advisory Group, we specialize in expense reduction and optimization. We can help you identify tax incentives and cost segregation opportunities that can lower your property tax bill. Our team of experts can also help you navigate the complex world of property tax mitigation to ensure that you are taking advantage of all available options to reduce your tax burden.

In addition to identifying tax incentives and cost segregation opportunities, we can also help you with expense management and solutions. Our expense optimization services can help you reduce your overall expenses, including property taxes, to improve your bottom line. We work closely with our clients to understand their unique needs and circumstances, and we develop customized solutions that are tailored to their specific goals and objectives.

By working with Reed Advisory Group, you can rest assured that you are getting the best possible advice and guidance when it comes to property taxes and other expenses. Our team of experienced professionals has a deep understanding of the tax code and regulations, and we stay up-to-date on the latest developments and changes in the industry. We can provide you with the tools and expertise you need to mitigate your property taxes and achieve your financial goals. 

Most Common Solutions for Property Tax Mitigation

There are several common solutions that businesses can use to mitigate their property taxes. One option is to appeal the assessed value of the property if it is believed to be too high. Another option is to take advantage of tax incentives and credits offered by the government, such as historic preservation tax credits or green energy tax credits. Cost segregation is another popular strategy that involves breaking down the components of a property to determine which components can be depreciated faster for tax purposes.

Additionally, we can help you with expense solutions and management to further optimize your finances. By analyzing your expenses and identifying areas where you can cut costs, we can help you free up resources to invest in other areas of your business.

Our team can also assist you with AP automation and shipping solutions to improve efficiency and reduce expenses. By streamlining your accounts payable process and optimizing your shipping practices, you can save time and money while improving your bottom line.

Calculate Your Potential Savings

If you're interested in learning how much you could potentially save on your property taxes, try using a tool like Property Tax Credits. This tool can help you estimate your tax savings based on your property type, location, and other factors. 

The tool is easy to use and can provide a rough estimate of your potential savings. However, it's important to note that the results may not be entirely accurate, as every property and tax situation is unique. For a more accurate assessment of your potential savings, it's best to consult with a property tax expert like Reed Advisory Group.

Our team of experts can analyze your property and tax situation in detail to identify opportunities for savings. We can also provide you with a customized strategy that is tailored to your specific needs and goals. With our help, you can achieve significant savings on your property taxes and improve your bottom line.

Schedule a Call with the Reed Advisory Group Team

If you're interested in exploring your options for property tax mitigation further, contact Reed Advisory Group today. Our team of experts can help you identify opportunities to reduce your tax burden and improve your bottom line. Schedule a call with us today at (570) 470-9775 or email us at [email protected] to learn more.