Now Is the Time To Review Property Tax Valuations

Now is the time of year when counties are publishing, mailing or providing notices of property assessments as required by Ohio law. Ohio Revised Code 5715.17 provides that counties must give notice that valuation revisions have been completed and are open for public inspection. Some counties have already started publishing values and providing notices. Counties generally have a fixed window in which to operate until values are frozen and must be contested by a complaint filed with the county’s Board of Revision. Taking advantage of the informal process is often the best way to handle issues with valuations because of the way the property tax millage is set for both property owners and property tax funded entities such as school districts, libraries and safety forces, among others.

Property Owners Should Review the Assessments

Prudent property owners should review the assessments and the assessor’s property information for correctness and address any discrepancies with the assessor informally within the time frames allotted by each county. For real estate and financial service professionals, reviewing assessment notices with clients is a great opportunity for a strategic discussion.

Property owners and occupiers should not be overly concerned when there are value increases. After all, property values should be increasing in a healthy economy, all things being equal. Plus, Ohio property owners benefit from House Bill 920, which tends to limit or temper tax increases when values increase. Additionally, Ohio has a 10.0% automatic credit for non-business property types, a $8,750 taxable value homestead exemption for senior citizens and totally and personally disabled, as well as a 2.5% owner occupancy credit.

House Bill 126

Tax year 2022 is the first tax year impacted by the passage of House Bill 126 earlier this year. To summarize HB 126’s major changes, the bill limits the ability of government authorities to file assessment increase complaints, proscribes private payment agreements between property taxpayers and government authorities, and requires government authorities to adopt resolutions to initiate appeals and that property owners receive notifications of the vote on such resolutions.

Value Evaluation Nuances

In Ohio, there are several nuances to consider in evaluating property tax values. First, it is important to understand that it is the market value of the fee simple interest that is assessed. This concept is an important issue to explore if your property is leased to one or more tenants, or if the property is a hotel.  Next, Ohio exempts personal property and business fixtures from property taxation. Accordingly, portions of buildings, structures and improvements that are specially designed, constructed and used for the business conducted in the building, structure or improvement, including, but not limited to, foundations and supports for machinery and equipment are property tax exempt business fixtures. Exempt personal property is present in many buildings, especially hotels, manufacturing and processing facilities, convenience stores with fuel service, apartments and intensive medical care facilities. Lastly, Ohio real property must be valued at its highest and best use for taxation purposes, which is an important consideration for properties at various transition points.

A listing of counties updating values by form of update and timing of notice is below:

If you have any questions, please contact Richard Morehouse (RAM@kjk.com; 216.736.7292), Steven Marrer (SAM@kjk.com; 216.736.7267) or Jon Pinney at ( JJP@kjk.com; 216.736.7260).