- Commercial / Industrial Properties
Commercial / Industrial Properties
If you own a business in Orleans, including the premises at which your business resides, the real estate tax for your property is determined through a careful annual analysis of income and expense statements (we call them I&E's) taken in concert with recent sales activity and the depreciated cost of your buildings. You may recollect that the Assessing office mails blank I&E forms out to you around March of each year. On these forms, we ask you to provide the 3 most recent years' worth of income your business has earned and list the qualified expenses you've incurred in that same time frame.
Why do we do this? Our business in this office is trying to figure out each property's fair cash value, or the price it could expect to fetch on the open real estate market should you decide to put it up for sale. Someone who is looking to buy commercial or industrial real estate is looking at the property as an investment opportunity. That buyer is going to be mostly concerned with 1) how much income the property can generate and 2) how much it's going to cost in expenses to ensure a maximum return on investment.
Because these 2 things factor so heavily in the potential sale price, we feel that the best way to give your commercial property a fair assessment is to have a look at that data. So we don't send you those forms every year to be a pain; we do it because we want to make absolutely certain that your value is as fair as we can possibly make it. This is also why failure to return an I&E to Assessing in a timely manner jeopardizes your rights to appeal your assessment.
Commercial and industrial properties are also subject to the same property inspection rules as residential properties. The assessor or a representative of our office will be visiting your property if you pull a building permit to do construction work on the property or file an abatement appeal on your property's value, and we will also ensure that we do at least 1 inspection at each property in town over the course of a 10-year period.
If You Want To Challenge Your Commercial Property's Assessment...
You should complete a real property abatement application (found here) and submit a physical copy to the Assessor's Office no later than February 1st. Applications sent via USPS must be postmarked no later than February 1st. Email and fax submissions will not be accepted as timely; you must mail or drop off your application to our office.
Along with your application, please include the following:
- Three most recent years' worth of income and expense information,
- Copies of all leases for all tenants occupying the property as of January 1st (not required if you own/occupy the entire property),
- Comparable arms-length sales of similar commercial properties in our market from the prior two years.
These supporting documents are non-negotiable. If you fail to submit satisfactory evidence with your application, we will make one request for more information. If you fail to respond to that request, the application will be denied.
The Board has 3 months from the date you submit your application to act on it. If your application is granted, your property's taxable assessment will be adjusted accordingly and you will be mailed a certificate showing the adjustment to your assessment. If you choose to pay the 3rd quarter tax bill, any adjustment will be reflected on the balance that's due in the 4th quarter. If you choose to pay the 3rd and 4th quarters, any adjustment will be refunded to you via check by the Treasurer's office. Filing an abatement application does not stay the collection of your taxes. And remember, abatement applications are usually due on the same day as the 3rd quarter payment. If your plan is to wait until the Board of Assessors decides on your application before paying, you will end up incurring interest and late fees on your bill that must be paid even if an abatement is granted. If your application is denied, no adjustment will be made to your assessment and you will be mailed a certificate stating the reason the Board denied your application.
If you don't agree with the disposition of your abatement application, you must file an appeal with the Massachusetts Appellate Tax Board (ATB), the neutral third party that arbitrates assessment disputes. You can call them at 617-727-3100 or visit their website for more information. While we certainly encourage any taxpayer who is aggrieved by an abatement denial to avail themselves of this option, the Orleans Assessing office will not provide appellants any assistance in gathering data or compiling records for an ATB hearing.