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Owning commercial real estate comes with many responsibilities; but there's one task many owners overlook until there's a due date: Property taxes. According to the professionals at Galvin Realty Group, Inc., taxes are one of the most misunderstood aspects of real estate ownership, especially in the commercial division of the market. Below, the Rochester, NY, property tax service specialists offer some guidance on what you need to know.

A Guide to Commercial Real Estate & Taxes

1. An Escrow Account Helps You Avoid a Large Lump-Sum Payment

Many owners don’t realize they can break their estimated property tax up into smaller payments and include it with their monthly mortgage. The extra money is transferred into an escrow account where it sits until it's time to pay those taxes.

Most residential mortgage lenders automatically take the step of setting up an escrow account in your name and filter the additional money to it. However, commercial lenders don’t always follow this procedure. Since the real estate typically results in a substantial tax bill, use a property tax service to set up this arrangement and avoid the financial strain of a large lump sum payment at the end of the year.

2. You Can Face Additional Costs Aside From Value Assessment

Property Tax Service The main portion of your property tax is composed of your value assessment, which is determined by an assessor; yet, you can also face additional costs. Direct assessments are charged at a flat rate for properties within a specific area to cover the cost of public services like parks. Special assessments, on the other hand, typically only affect new housing developments, and they're designed to assist with the costs of extending government-funded services to those areas, like public schools. It's important to look into the additional expenses associated with a purchase so you can budget appropriately.

3. Missing Your Property Tax Deadline Can Result In Additional Fees

Always stay on top of the deadlines to avoid late fees. Most properties face two due dates every year: One for the city and one for the county. For instance, in Rochester, the city tax is due on July 31st while the Monroe County tax isn't due until February 10th. Missing these deadlines can increase your liability as a result of late fees, so it's vital to your bottom line that you take due dates seriously.

Tackling these issues on your own can be challenging, but the property tax service experts at Galvin Realty Group, Inc. can help you stay on track. The Monroe County firm offers a variety of services to help commercial real estate owners excel in their industry, including assessment management. Learn more about their specialties online, or schedule your consultation today by calling (585) 546-1290 to discuss their property tax services.

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