New Legislation Establishes July 1, 2020 as the Filing Deadline for All 2020 Property Tax Appeals

Last updated May 18, 2020

The Legislature has unanimously passed, and the Governor is poised to sign, a bill that establishes July 1, 2020 as the filing deadline for 2020 tax year appeals to the New Jersey Tax Court, as well as the 21 County Boards of Taxation. This law supersedes the original filing deadline of April 1st and, for revaluation and reassessment municipalities, May 1st. With the uncertainty of the deadline now resolved, taxpayers have until July 1st to have their properties reviewed and analyzed to determine whether a 2020 property tax appeal is warranted.

While the primary concern during this time is obviously the health and safety of all, the economic consequences resulting from this crisis are already self-evident. The nature, extent and duration of the COVID-19 impact on real estate valuations remain uncertain. Many property owners are still dealing with the immediate effects of the pandemic and may not have even begun to focus on how it has affected their property tax assessments.

Further, it must be noted that the “valuation date” for the 2020 tax year was October 1, 2019. As the paralyzing scope of the pandemic presented only at the beginning of March 2020, it could technically be viewed as a “post valuation date” event and, on the surface, be deemed ‘not relevant’ for the 2020 tax year. This may well be the response of municipalities in defense of 2020 appeals filed as a result of the pandemic. However, each property owner should nevertheless evaluate its property; for while whatever relevance COVID-19 has for the 2020 tax year, the near future impact may be so severe that it will certainly have relevance for the 2021 tax year. Therefore, filing a 2020 appeal may place a taxpayer in a better position to negotiate with the municipality for the 2021 tax year and beyond.

Certain property types appear to have been indisputably impacted by the pandemic. Topping that list are retail and hospitality properties, including restaurants. Closely following those asset classes is the office building segment as the amount and format of office space required by tenants in the “new normal” will be, by many accounts, fundamentally different. There could also be a drastic change in the multi-unit residential marketplace with the advent of the rising unemployment rate as well as the wild card of how and where people will choose to live after having experienced the health consequences of the pandemic in our densely populated metropolitan areas.

At the other end of the spectrum, there may well be certain property types whose valuations are actually enhanced by the consequences of the pandemic. Warehouse and distribution centers will likely continue to experience the market appreciation they were experiencing before the pandemic hit. Importantly, this trend may lead municipalities to continue and even expand the practice of filing “reverse tax appeals” through which they actually seek to increase the assessment on those properties.

Finally, from the redevelopment standpoint, we are aware of analyses being performed in Trenton concerning potential amendments to the statutory regime providing for Payments in Lieu of Taxation (“PILOTs”). It is likely that the State will focus on expanding the toolkit for encouraging redevelopment efforts in the face of a drastically changed real estate landscape.

CSG’s Property Tax Group is poised to address all of these issues and we welcome the opportunity to evaluate properties for appeal potential at no charge. Tax appeals generally are handled by the firm on a contingency fee arrangement, although other fee arrangements, including application of standard hourly rates, can be utilized.

For additional information pertaining to the coronavirus outbreak, please visit CSG’s COVID-19 Resource Center.

This publication contains general information on recent legal developments and is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. Attorney Advertising. Prior results do not guarantee a similar outcome.