All Forum Posts by: Gregory Wilson

Quote from @Jason Malabute:

It really depends on the county where your property is located. Some counties allow you to contest the assessment and successfully get a reduction, while others won’t even entertain the question.

For example, I have a property in Atlanta, Georgia, in Clayton County, and when I tried to get a property tax reduction, the county outright told me they wouldn’t even consider it.

When that happens, your only real option is to hire a lawyer who specializes in contesting property tax assessments. However, you have to weigh the costs—does the amount you’re paying the lawyer justify the potential savings? And if so, what’s your realistic chance of winning the appeal?

If your property’s tax increase is substantial, it might be worth consulting a specialist to evaluate your options.

Most everywhere you must file an official  petition or a complaint. Otherwise, people the Auditor knew or liked would just call up and complain and get a favor. We had that scandal 30 years ago even with the petition. It turned out that all of the petitions for reduction that were granted had the letters "FOJ" in the upper right hand corner. Eventually, the Grand Jury found that that stood for "Friend of Joe" referring to Joe XXXXX (last name redacted) who was the County Commissioner. Of course he was a giant in the County and resigned in disgrace instead of serving prison time. But it is still a great story. Here is a recap: https://www.cincinnati.com/story/news/crime/crime-and-courts...

Just a reminder that the deadline for filing a Petition for Reassessment seeking reduction of real estate tax in Ohio is March 31. After that, no go. 

The filing deadline in Ohio is March 31.

An interesting aside is the political aspect of tax cases. Brown TCM2013-275 is, of course, not a precedent for anything because of it being a TCM decision. But, what is really interesting is the Judge's mention of the Koch brothers and his continuous rant about the millions of income the taxpayer must have gotten  and the habits of the very rich - right in the text of the decision. This all become clear when one considers that J. Holmes, the author, was a Harvard grad who was trained in the CA Federal 9th Circuit under one of the most politically left judges in America and appointed by President Obama to the USTC. Probably a good reason for why USTC decisions do not mean anything to tax strategists. But when millions are involved, it helps to understand the background of prior decisions that are not binding on the matter at hand.

I have not yet had time to look at the other case yet. But thanks aging for the PS tip.

Thanks, Michael. You are right again. It was absolutely my intention to twist the language of the Reg. Its actually the definition of my job. And, like you, I see no need to argue further.

Quote from @Michael Plaks:

Quote from @Gregory Wilson:

I think you misunderstood. The offer to lease was "as is" and which is by definition in a state of readiness. Frankly, this thread should help the CPA's in the crowd understand why taxpayers often complain that their tax preparers are not aggressive enough. For my part I see this as okay. I can see a IRS Publication based approach to tax preparation. 

The offer to lease should be genuine. If it's under construction, it cannot be leased. If you want to call it "aggressive", be my guest.

A property under construction certainly can be leased. Where did you get that idea?

I think you misunderstood. The offer to lease was "as is" and which is by definition in a state of readiness. Frankly, this thread should help the CPA's in the crowd understand why taxpayers often complain that their tax preparers are not aggressive enough. For my part I see this as okay. I can see a IRS Publication based approach to tax preparation. 

Quote from @Sean Graham:

Quote from @Gregory Wilson:

Quote from @Natalie Kolodij:

Advertising alone won't qualify unfortunately. 

It definitely helps; but the IRS looks at other pieces as well including occupancy permits, extent of renovation, etc. It's when it's ready and available for rent. 

A normal turn around time of advertising while doing finishing touches, able to be occupied within next few weeks would be reasonable. 

Advertising at the beginning of a full studs out renovation or something that will be months down the line wouldn't work out. 

None of that stuff is in the Treasury Regulation. It comes from IRS Publications which are, of course, not binding on the IRS or the taxpayers or the courts. But, moreover, it is just a timing difference and a short one at that - part of a year. And, if the taxpayer is wrong and there would be no person who would ever lease a project under construction (which I doubt) at least the timing adjustment goes the safe way for the taxpayer.

Interesting. I think the conservative route is to use the earliest date that the property is both available for move-in and has been advertised for rent. 

I think you are right about the conservative position. But please note that "move-in" is not part of the statute or regulation. It still comes down to when the property is "placed in service."
If you advertised and a tenant appeared with money to rent, without a certificate of occupancy having been issued, or a kitchen with appliances and you accepted that rent the placed in service date would be when you advertised it. Notwithstanding the IRS Publications quoted above.

Quote from @Natalie Kolodij:

Advertising alone won't qualify unfortunately. 

It definitely helps; but the IRS looks at other pieces as well including occupancy permits, extent of renovation, etc. It's when it's ready and available for rent. 

A normal turn around time of advertising while doing finishing touches, able to be occupied within next few weeks would be reasonable. 

Advertising at the beginning of a full studs out renovation or something that will be months down the line wouldn't work out. 

None of that stuff is in the Treasury Regulation. It comes from IRS Publications which are, of course, not binding on the IRS or the taxpayers or the courts. But, moreover, it is just a timing difference and a short one at that - part of a year. And, if the taxpayer is wrong and there would be no person who would ever lease a project under construction (which I doubt) at least the timing adjustment goes the safe way for the taxpayer.

Place an ad on Facebook Marketplace (free) listing the property for lease and disclosing that while it is immediately available to lease it is under construction, and use the ad date as your depreciation starting point.

Be sure to keep a copy of the ad with your tax papers in the 1 in 1000 likelihood that anyone will ever ask you to prove it.

What you don't want is that upon the sale years later you find the IRS adjusting the cost basis to take into account the year of purchase as a year of "allowable" depreciation even though you didn't start depreciating that year because the rule is that whether you take it or not it is treated as a reduction of the cost basis.