A Comprehensive Guide to Commercial Industrial Property Tax in TexasBy: Michel Gray Tax Team / June 4th, 2023
Commercial industrial property tax is a complex topic that requires a thorough understanding of Texas property tax law. In Texas, industrial property includes power plants, gas plants, refineries, and other facilities used for industrial purposes.
If you own commercial industrial property in Texas, it’s important to understand how your property is valued and how property taxes are calculated. The property tax assessment process for industrial property is unique and can be quite different from other commercial property types. Here are some examples of commercial industrial properties in Texas:
- Power plants
- Gas plants
- Oil refineries
- Chemical plants
- Manufacturing facilities
- Warehouses and distribution centers
- Mining operations
- Data centers
- Telecommunications facilities
- Research and development facilities
- Biotech and pharmaceutical facilities
- Food processing plants
- Beverage production facilities
- Textile mills
- Steel mills
- Cement plants
- Pulp and paper mills
- Wood product manufacturing facilities
Now that we have an idea of the different types of commercial industrial properties, let’s dive into how they are assessed for property taxes and what challenges and opportunities they present for property tax consulting. Property tax assessment for industrial properties is a complex and often contentious process that involves multiple factors, including property value, productivity, machinery and equipment, environmental compliance, and regulatory requirements. Industrial property owners and operators need to navigate this process carefully to ensure that their property tax bills are fair and accurate, and that they are not paying more than their fair share of taxes. This is where a property tax consultant with industrial expertise can be invaluable.
Industrial Property Tax Assessment
The value of commercial industrial property is typically assessed by the county appraisal district, which determines the market value of the property. This value is then used to calculate the property taxes owed.
The value of industrial property is often determined using the cost approach, which takes into account the cost of constructing the property, as well as the land value. This approach is used because the market value of industrial property can be difficult to determine due to the specialized nature of the facilities.
Exemptions and Deductions
There are several exemptions and deductions available to commercial industrial property owners in Texas. These include:
This exemption allows eligible manufacturers and distributors to exclude up to 100% of the value of certain types of inventory from property taxes.
Pollution Control Exemption:
Property used for pollution control purposes may be eligible for an exemption from property taxes.
Certain types of charitable organizations, such as hospitals and non-profit educational institutions, may be eligible for property tax exemptions.
Economic Development Incentives:
Some local governments may offer property tax abatements and other incentives to encourage economic development.
Renewable Energy Exemptions:
Property used for renewable energy production, such as solar or wind farms, may be eligible for property tax exemptions.
Navigating the various exemptions and deductions available to industrial property owners in Texas can be a daunting task. It’s essential to work with an experienced property tax consultant who can help you identify all the exemptions and deductions that are available to you.
How a Property Tax Consultant Can Help
At Michel Gray Rogers LLP, we specialize in commercial industrial property tax consulting and can help you navigate the complexities of the property tax assessment process. Our team of skilled lawyers has extensive experience in property tax appeals, compliance, and advocacy, and can assist you with:
- Property tax budgeting
- Property tax appeals
- Asset review
- Property tax abatements
- Business tax compliance
- Property tax exemptions
- Property tax bill review
- Property tax policy advocacy
- Deal pricing allocation
- Property tax forecasting
- Ag and wildlife management valuation
Our goal is to help you reduce your property tax liability and save you money. We understand the unique challenges that industrial property owners face in Texas, and we have the expertise to help you navigate the complexities of industrial property tax consulting.
If you’re a commercial industrial property owner in Texas, don’t let the complexities of commercial property tax consulting overwhelm you. Let our team simplify the process and help you save money on your industrial property taxes. Call us today to schedule a consultation and learn more about our commercial industrial property tax consulting services.