Reducing your industrial property tax bill is like losing weight: Not every diet works equally well.

If you’ve already tried one or two tax reduction diets and they didn’t work to your satisfaction, we strongly recommend the ITC method. It is based on the realization that since property taxes are not fixed who says that you have to pay what’s being assessed? 

ITC offers a 7-step program that will help you lose what you don’t want and gain what you do – extra capital to reinvest in your business. Here then are the 7 easy and painless steps to take utilizing the ITC method.

Step 1: Identification of Non-taxable Assets

Every jurisdiction has its own laws and rules. It therefore of utmost importance to divide assets into taxable and non-taxable categories. This includes items such as software, overhead allocations and intangibles. For example, what if you have moved a piece of machinery out of state or a new zoning law has gone into effect and nothing has been updated yet? As you correctly guessed, you’ll be paying taxes you shouldn’t be paying.

Step 2: Asset Capitalization & Depreciation Examination

Asset Capitalization is the process of recognizing an asset on the balance sheet whereas depreciation refers to the spreading of the cost of an asset over its lifetime, instead of the year in which it was acquired. Rebuilds, upgrades, overhauls and other unique circumstances can also be counted as assets. Our experience will guide us towards applying the most advantageous appraisal technique in order to reduce taxable income.

Step 3: Separation of Personal & Commercial Properties

It seems obvious, but since personal properties are generally taxed less than commercial properties, the distinction is crucial. For example, when dealing with a large organization owning multiple properties, the line between personal and commercial properties can be blurred - a laptop that an employee uses can be classified as personal property and is taxed less than heavy machinery. Taken over numerous items that can make a significant difference towards a reduction in taxable income. 

Step 4: Identification of Idle, Underutilized or Obsolete Assets

What about that unused forklift that’s just sitting around getting rusty or any other piece of equipment that’s only used once in a blue moon? Properly documented and assigned a fair and equitable value, these assets can also make a difference in reducing taxable income.

Step 5: Valuation Analysis

Complex Industrial Property tax is a subjective tax that is applied to your assets based on different analysis models. However, performing a thorough revaluation of every aspect such as cost, market and income approaches usually identifies new avenues for tax relief.

Step 6: Reduction Appeal

Once the revaluation process is completed and a discrepancy between the official declaration and the updated assessment have become apparent, it’s time to file for either a judicial appeal or an arbitration. Which now presents an opportunity to sit face-to-face with the tax collectors to debate the original valuation.

Step 7: Income Analysis

Various existing income-based valuation models used in the assessment of the industrial property need to be analyzed in order to optimize reductions. The complexities and particular characteristics of an industry or business need to be taken into consideration, and they include the application of the different cost to capital principles for different income streams.

And now you’re close to seeing the results of ITC’s 7-step tax-saving method. All you need to do is move your fingers and let ITC’s teams of seasoned experts devise the ideal tax-minimization strategy for your business. It’ll be a totally customized solution because we don’t utilize cookie-cutter templates. The result is unique, too. You’ll be losing and gaining at the same time: less taxes = more profit!