Top Misconceptions About Protesting Commercial Property Tax

Commercial Property Tax Misconceptions

Commercial property tax is a collective financial concern for business owners and investors. The expense is not stable because an appraisal district can alter your tax bill from year to year. 

This does not mean that your new taxable value is necessarily accurate. You have the right to protest the value assigned to your commercial property, but it’s important to avoid preconceived misconceptions about the process.

Taxing Entities Direct Appraisal Districts to Raise Assessed Values

A big jump in your property tax bill, especially when not expected, makes it easy to think that your local governments have ordered the district to bump up everyone’s taxes. Although governments probably wish they could do this, they can do no such thing.

Property Tax Code 23.01 states that tax appraisers establish the market values of properties as of January 1st each year. The Uniform Standards of Professional Appraisal Practice outline the proper procedures for the process. The comptroller’s office is supposed to check a district’s methods for compliance at regular intervals.

Appraisal Districts Make Decisions Based on All Sales Data

Texas is a non-sales disclosure state, which means that districts do not have access to all information regarding property sales. No mechanism automatically feeds this data to them.

When calculating a commercial property tax, an appraiser relies on local brokers, realtors, and individuals who bought or sold the property to respond to an appraiser’s queries. As a result, most appraisals are not based on a complete picture of current sales activity. When possible, property tax consultants in Dallas provide an appraiser with additional data that could impact the property tax calculation.

Tax Owed is Subject of Property Tax Protest

Although the dollar figure on the tax bill prompts you to protest, you are actually protesting the appraised value of the property. When you or your representative approach the appraisal district, you raise questions about the current appraisal’s accuracy. The value is an important factor in the calculation of what you owe. The tax bill itself can only be altered if an adjustment of the value yields a different figure.


commercial property tax bill


Payment of Tax Bills Delayed Until Protest Resolved

A tax bill cannot be paid late without consequences. If it looks like your protest will still be pending when the bill comes due, you need to pay it. Becoming delinquent on the tax could forfeit your right to continue the protest.

Property Value is the Sole Deciding Factor in Tax Assessments

Your tax bill derives from the market value minus exemptions multiplied by the tax rate. The tax rate could be just as influential on the tax owed as the market value.

Property tax consultants at the Hegwood Group can investigate your questions about your tax bill and manage the protest of your commercial property tax. Contact us today.

What is Ad Valorem Tax?In-depth guide to property taxes in Texas