When you receive a bad property tax assessment, how do you fight it? The best way to win when you're dealing with oil & gas equipment property tax appeals is by knowing what's involved in the process and the best steps to take to get through the process as quickly and effectively as possible. Here's a quick look at what's involved in a property tax appeal and the steps to take to win your appeal without a lot of extra work.
What's involved and how do you win in oil & gas equipment property tax appeals?
Though getting a bad property tax assessment is a terribly unpleasant surprise, you do have options available to fight the assessment. Virtually every tax agency includes an appeal process. Many businesses have been through the process and come out well on the other end, but only by knowing how the process works.
To start, look at the documentation that was provided by the tax agency in question. It should include information about your rights and where to look to learn about the process. Start with that information to determine what your available timeline will be through the process. The information will also tell you what your rights are.
The process may also require that the assessor follow certain procedures, such as the use of a standardized valuation guide and that the tax codes for that agency be applied uniformly to all taxpayers. Do you have the ability to request the documentation of how your equipment was assessed? Can you request other records from the tax agency's office? By knowing what your rights are, you can better defend them.
The next step is to prove the actual value of your equipment. The best way is through an equipment valuation. The value in your depreciation schedule may not reflect equipment that has been heavily used. If you depend on your equipment dealer, you'll get the value they think you're looking for. There are any number of other ways to come up with a value for your equipment, but it's not necessarily going to be an accurate value.
When an equipment appraisal is performed, it looks at what the equipment's value actually is. They look at the overall condition of the equipment, providing you with not only the value based on those aspects, but also prospective issues that need to be handled and the expected overall lifespan. They take into account the current market conditions, whether a hot market is raising the value of your equipment or a slow one is lowering it. They can provide you with the most accurate value that will hold up well in tax appeals.
Getting a bad property tax assessment is stressful, but knowing what's involved in fighting it so that you can win oil & gas equipment property tax appeals makes it much easier to get through the entire process successfully. If you decide to get an appraisal of your machinery, make sure that you work with a certified equipment appraiser. The certification process uses standardized methodologies that have been tested countless times in legal, financial, insurance and tax circles, ensuring that they'll hold up against strong scrutiny. Ask whether the appraiser you're hiring has been through the certification process.