We evaluate opportunities to determine the best abatement for your situation and assist you in filing applications. Works to get a combination of the lowest assessment with the best abatement.
A manufacturing company built a new facility on a green field site in Michigan. The company contracted with the National Bureau to assist in the initial enrollment of both the real and personal property. Uncertain of the tax
incentive programs offered by the State of Michigan, our client also asked us to provide expertise in this area. The goal was to obtain the best abatement and to apply the abatement against the lowest, legitimate assessment-the best of both worlds.
After our initial consultation, we determined that the new site qualified for an Industrial Property Tax Abatement (IFT). This program allows new investment to be taxed at a rate that is roughly half the normal rate for a period of up to 12 years. We filed all proper forms and documents with the local and state authorities. Because the actual construction and equipment purchase costs must be revealed in the application process, it is crucial to work closely with local assessing authorities to make them aware of the true value of the property for determining the assessment. On the real estate, we took the position that property cost should not be the basis for the assessment and provided documentation to justify a lower value.
By qualifying this company for an IFT, the annual tax benefits from the reduced property tax rate exceed $400,000. Additionally, when the values for the real property were enrolled at a substantial discount to construction costs, the
property tax savings to the company exceeded $150,000. Annual tax savings in excess of a half million dollars are one of the reasons this company has continued to grow and expand each year.