Lower 2023 Ratio, Court Case on 2022 Ratio, Extended Appeal Filing Period — New Opportunities for Lowering Your Property Tax Assessment

John T. Vogel, Esq., jvogel@tuckerlaw.com, (412) 594-5622 and Daniel C. Conlon, Esq., dconlon@tuckerlaw.com, (412) 594-3951

In Allegheny County, tax appeal season has begun for 2023.  Every year, County property owners have the opportunity to file an assessment appeal.  But this year there are unique opportunities for an assessment reduction.

Property tax assessments are based on the fair market value of the property adjusted by the “common level ratio.”  The ratio acts like a deflation factor so that owners do not face assessment increases just because of cost-of-living increases.

This year provides unique opportunities for potential assessment reductions.  First the common level ratio, which had been approximately in the 81%-87% range, will be 63.6% for 2023.  That means if your property has a fair market value of $100,000, for assessment purposes your property should be taxed at $63,600 for 2023.

The second factor is that litigation is ongoing as to whether the 2022 ratio should be in the 63% range, and not 81.8%, as had been officially published earlier.  As a result of that lawsuit, Allegheny County reopened the appeal deadline for 2022 appeals, just in case the appeals court rules the ratio should be at the lower figure.

These changes are favorable for taxpayers, but before considering an appeal, initially owners should determine if their property has actually increased in value.  Home sales have been strong in 2020-2022 and some retail business properties, especially in the suburbs showed some stability.  Your home or business property may be in an area that are “hot spots” relative to the rest of the County.  Yet for commercial parcels, increased vacancies or rent reductions caused by market conditions can lessen a parcel’s value.  Of course, if your business properties have been hurt because of post-COVID trends, justification for an assessment decrease may exist if the property produces less income.

Assessment reductions are usually proven through recent sales of comparable properties or, if the parcel produces income, through the property’s income and expense statements.  Owners should use common business sense in considering whether to file an appeal.  If properties in your area are selling for $1.5 million and your assessment is $1 million, even with a ratio change, careful consideration should be made before filing an assessment appeal. 

The officials hearing your tax appeal at the Board of Property Assessment (the first stage of the assessment process in Allegheny County), or at the Board of Viewers (the second stage) are very knowledgeable about local real estate.  But if sound reasons exist, opportunities should be pursued and retention of legal counsel knowledgeable about Allegheny County tax appeal law and practice should be considered.  The appeal deadline is March 31, 2023.

For further information contact Tucker Arensberg attorneys John Vogel at (412) 594-5622, Daniel Conlon at (412) 594-3919 or Ashley Puchalski at (412) 594-5509.