City announces update on property tax assessments, including timing of written notices
The city’s Office of Property Assessment released the results of reassessments of all Philadelphia properties and announced that written notices of new property values will be sent to property owners later this month. Landlords should begin receiving written notices in the mail in late August.
New values for more than 580,000 residential, commercial, industrial and institutional properties in Philadelphia are set to take effect for the 2023 tax year, with property taxes due March 31, 2023. Citywide reassessments planned for tax years 2021 and 2022 have been postponed due to operational issues arising from the implementation of CAMA (TY21) and the COVID-19 pandemic (TY22). Thus, this year represents the first revaluation of market values since before the pandemic.
The new values are available online at: www.property.phila.gov and will be sent to owners this month. Owners who believe their assessment is incorrect have until October 3, 2022 to file a formal appeal. Landowners can also apply for an informal First Level Review (FLR) with the OPA, with FLR applications due September 30, 2022.
Requesting a first-level review does not preclude owners from filing an appeal with the Tax Review Board (BRT). They can file both as long as they meet each deadline. More information on this process is described below.
Reflecting the strength of the real estate market in Philadelphia, the citywide revaluation found that the overall value of all properties in Philadelphia has increased by approximately 21% since tax year 2020.
To reduce the potential impact these rising values could have on residents, Mayor Jim Kenney and City Council have agreed to a package of payroll and business tax relief and reductions. These measures will ensure that general fund revenues from reassessments are placed directly in the hands of taxpayers.
“The rising property values are a good reflection of the fact that Philadelphia is a prime location and represents an opportunity to create wealth for some. But landlords – especially our most vulnerable – deserve protections, which is why I signed a bill for $298 million in new landlords and rent relief over five years, representing a historic commitment to Philadelphians” , Kenney said. “We made a commitment at the start of this process to work closely with the City Council on tax relief and reforms and – in partnership with the City Council – we are working to deliver on that promise by providing substantial relief to property owners who have been affected by the long-term boom in the real estate market.
How to dispute a review
Owners who believe their assessment is incorrect may request a First Level Review (FLR) from the OPA. The FLR forms are included with the assessment notice that is sent to owners this month. FLR forms must be submitted to the OPA by September 30, 2022.
There is also a formal appeals process conducted by the Tax Review Board. The deadline to file a formal appeal with the Tax Review Board is October 3, 2022. The deadline to file a formal appeal is established by state law and is not affected by the filing of a first-level exam.
Requesting a first-level review does not prevent you from filing an appeal with the Tax Review Board. You can file both as long as you meet each deadline.
Official appeals must be filed with the BRT no later than the first Monday in October (October 3). Details of both calling options can be found at: www.phila.gov/departments/office-of-property-assessment/property-assessments/.
“The goal of this year’s reassessment is to ensure appraised values more accurately reflect sales and market forces,” said James Aros, Jr., director of appraisal, Office of Property Assessment (OPA) . “In doing so, we accomplish one of OPA’s core missions: to minimize inequities between comparable properties by ensuring that similar properties have similar valuations. If people think their assessment is incorrect, we encourage them to seek a first level review with the OPA, as well as a formal appeal with the Tax Review Board, as soon as possible. »
Property tax relief programs for homeowners
Tax relief programs are available for homeowners. From the Homestead Exemption to LOOP to the Property Tax Freeze for Seniors and more, these programs are administered by the Department of Revenue. The city offers many property tax relief programs for homeowners.
Extension of tax breaks and payroll tax reductions
In June, Mayor Kenney signed into law Bill 200012, which increases the city’s property exemption from $45,000 to $80,000, effective in tax year 2023. That means 80 $000 of a property’s assessed value will be exempt from property taxes. This change will be reflected in property tax bills for 2023. Homeowners who are already enrolled in the Homestead program will automatically see this change and will not need to re-apply. With this change, most homeowners will save around $1,119 on their property tax bill.
The Real Estate Tax Estimator widget is also available at: www.property.phila.gov. The Real Estate Tax Estimator widget helps taxpayers estimate their future tax bill with the increased Homestead Exemption. To use it, simply type in your address and the feature will give users the option to choose between: $0, $45,000, or $80,000 Homestead value.
Long Term Owner Occupancy Program (LOOP)
The mayor also signed an extension of the LOOP program into law (Bill No. 220497). LOOP is an income-based program for homeowners who have lived in their home for ten years or more and are experiencing a significant increase in their property assessment. Bill #220497 also allows an alternate route to LOOP for homeowners who do not meet the 50% threshold in one year but have experienced assessment increases of 75% or more over a five-year period. . Under the plan, the total amount of funds available for disbursement among qualified owners in a single fiscal year has increased to $35 million from the current $25 million.
Gel program for the elderly
The mayor also signed an extension of the senior citizens’ tax freeze program (Bill No. 220499). The Seniors’ Property Tax Freeze Program allows low-income seniors, age 65 or older, to permanently freeze their tax bills. With these latest changes, eligible seniors will have the option to retroactively enroll in the seniors tax freeze. This means that if someone is 70, but new to the program and qualified at 65, they can freeze the value of their property at the amount they had at 65. Therefore, these seniors will only pay tax on their assessment from the year they first became eligible, dating back to 2018.
Additional relief efforts
The FY23-27 five-year plan also expands rental assistance by allocating $30 million over two years; expands community reach by allocating more than $4 million to outreach and taxpayer assistance programs; and allocating $1 million for anti-displacement legal services for low-income Philadelphians involved in landlord-tenant disputes and other issues exacerbated by rising assessments.
Salary and business tax cuts
The FY23-27 five-year plan also includes $187 million in payroll and business tax cuts over five years. The residential payroll tax rate is reduced to 3.79% (from the current 3.8398%) and the non-resident rate is reduced to 3.44% (from the current 3.4481% ). These are the lowest payroll tax rates in Philadelphia since 1976.
To learn more about the OPA’s property assessment process, visit: www.phila.gov/departments/office-of-property-assessment/property-assessments/. For more information on tax breaks, see: www.phila.gov/services/payments-assistance-taxes/get-real-estate-tax-relief/.