Filing Cutoff is Aug. 1 in Most PA Counties
If you own retail, office, industrial or other commercial property in Pennsylvania, now is the time to review the tax assessment for your property against its current market value. The increase in interest rates has caused many property owners to experience declining property values given an increase in the cap rates. These and other factors may be grounds to support a reduction in your property’s tax assessment.
Unfortunately, county boards of assessment cannot reassess property every year based on the local economy. As a result, the real property taxes that the board assesses against your property for county, municipality and school district taxes may be out of proportion to its actual value or the value attributable to your property by the county.
But you must act quickly, the deadline in most Pennsylvania counties to file a tax appeal is Aug. 1, 2025.
What Should You Do if You Think Your Real Estate Taxes Are Too High?
First, you need to determine whether to file an appeal with the county board of assessment. You need an experienced real estate assessment attorney and a qualified appraiser. We can assist with a preliminary analysis of the fair market value of your property and then, if appropriate, to identify the best real estate appraiser to determine the fair market value of your property, complete an appraisal report and testify at the board of assessment hearing.
Second, you need to multiply the assessment, as determined by the board of assessment, by the state’s published common level ratio for the county where the property is located to determine the assessed market value.
The common level ratio factors increased effective July 1, 2025, in most Pennsylvania Counties, including Bucks, Montgomery, Chester, Delaware, Berks, Lehigh, Northampton and Lancaster Counties (with Philadelphia remaining the same), as follows:
- Bucks – 15.87 to 17.06
- Montgomery – 3.04 to 3.25
- Chester – 2.95 to 3.14
- Delaware – 1.63 to 1.74
- Philadelphia – 1.00 (Unchanged)
- Berks – 2.75 to 2.91
- Lehigh – 1.88 to 2.02
- Northampton – 5.39 to 5.88
- Lancaster – 1.77 to 1.87
What does this mean? The Board of Assessment has effectively increased the value of your property on its assessment rolls. This may open an opportunity for you to appeal your tax assessment.
Third, compare the fair market value of your property to the assessed market value to determine if you have a legal basis to file a tax appeal. If so, our office can assist you in filing the tax appeal.
How Best to Determine the Fair Market Value of Your Property
For commercial properties, two calculations often determine whether you should appeal your tax assessment. Capitalization of income and comparable sales gives us the ability to make a preliminary determination as to whether a particular tax assessment is out of line.
The capitalization of income approach is the easiest and quickest test to determine the value of your property, whereas comparable sales require more information. Up-to-date information on costs, square footage, occupancy, types and number of leases, use, location, mortgage amounts and interest rates, rental income and expenses are all necessary to complete the capitalization approach. Recent comparable sales within the last year or two should be reviewed and analyzed, as well as properties under agreement of sale. Rent abatements, lease defaults and vacancies are also factors that impact the value of a property.
With the above in mind, now is the time to review the real estate tax assessment on your commercial properties. If the assessed market value determined by the board of assessment exceeds the fair market value of your property, or if you have experienced rental income problems in the past year, an appeal of your assessment may be in order. We can help you make that determination quickly. Time is of the essence. In Pennsylvania, the deadline for filing a tax appeal in most Pennsylvania counties is Aug. 1, 2025, excluding Philadelphia County, where it is Oct. 6, 2025.
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