Top of Mind

The Allegheny County real estate tax appeal deadline for Tax Year 2024 is April 1, 2024. Now is the time to consider the current value of the assessable components of your Allegheny County real property and whether it’s time to file an appeal. This is a particularly good year to do so. Here’s why:

Pennsylvania uses a “base year” assessment system, where property assessments generally do not change, unless: (i) a significant change is made to the property that gives the county’s assessment office a lawful right to change the assessment; (ii) an interested party — a taxing jurisdiction, the property owner, or a tenant in some circumstances — files an annual assessment appeal; or (iii) a countywide reassessment is conducted.

In an assessment appeal, Pennsylvania gives property owners the right to present evidence of current market value, to which an equalization ratio is applied to take current market value and reduce it to “base year” value. This equalization ratio is calculated each year for each county based on sales data.

Notably, the equalization ratio is calculated upon recent sales of all property types collectively. Of course, for any number of reasons, the value of one particular property type may change differently than others. One only needs to look at the difference between office complexes vs. residential properties in recent years to see this. The development of one equalization ratio for all property types advantages the property types that are not appreciating in value as well as the average.

Further, there has been a very property-owner-favorable drop in the equalization ratio between last tax year and this one for Allegheny County. This makes now a good time to evaluate the current value of the assessable components of the property, and evaluate whether the property’s assessment is high after this equalization ratio is applied to the current value estimate. This is true for all property types, but is particularly true for those property types that have not fared well in recent years, like office complexes.

Quite often, it’s decades between countywide reassessments in Pennsylvania — unlike nearly every other state, there is no requirement in Pennsylvania that counties regularly re-assess. Because of this, the tax savings achieved in a Pennsylvania tax appeal may be enjoyed for many years to come.