NATIONAL REPORT—Many hotel owners in 11 states across the country are unaware that they can reduce their property-tax burden by filing property-tax disaster-relief claims, which could be an opportunity for hotel owners to lower, and even defer, their property-tax payments.
“The states we’ve focused on for property-tax disaster-relief claims are California, Texas, Illinois, Washington and Virginia,” said Doug Mo, a lawyer specializing in property-tax matters at the Sacramento, CA, office of global law firm Eversheds Sutherland. “I don’t believe that most hotel owners are aware that there may be special provisions of the state tax codes that provide for property-tax relief based on the current pandemic. Also, officials in a few states have suggested that the disaster provisions may not apply to a pandemic where physical damage to property may be limited. These comments may have had a chilling effect on some claims. In general, we believe that taxpayers are entitled to relief in many of the states we have looked at, notwithstanding the opinions of some states.”
Mo noted that in most states that provide disaster relief, the typical method of providing relief is to measure the fair market value before and after the disaster.
“For most hotel owners, their damages could be based on reduced income expectations and increased industry risk,” he said. “The decline in fair market value will result in a reduced property-tax liability.”