Ohio Legislation Offers Real Estate Investors COVID-19 Tax Relief

On April 27, 2021, Governor DeWine signed into law special legislation designed to account for decreases in property values caused by “a circumstance related to COVID-19 pandemic or state COVID-19 orders.” This COVID-19 Relief Legislation should be of special interest to real estate investors owning properties particularly affected by the pandemic, such as hospitality properties, retail centers and out lots, as well as, multi-family and office investors who have lost tenants due to the economic impact of the pandemic.

This special legislation permits challenges to 2020 valuations by filing a complaint between July 26, 2021 and August 25, 2021 and is intended to provide relief for impact on property values due to the COVID-19 pandemic. This law allows the investor to prove the negative impact that the pandemic had on their property and to receive tax relief by demonstrating that their property value dropped as of October 1, 2020.

Prior to this special legislation, existing Ohio law permitted the filing to contest a taxpayer’s property valuation only once every three years unless affected by certain circumstances. See ORC §5715.19. This law is commonly referred to as the “triennium rule.” This new law permits a taxpayer to disregard the “triennium rule” and permits filing of an additional complaint to challenge the property valuation so long as it is filed in 2020, 2021, or 2022 and relates to a decrease in property value stemming from the pandemic or state COVID-19 orders.

To establish that the pandemic or State of Ohio COVID-19 orders caused a reduction in the valuation of the property, a taxpayer could present financial statements, such as an income statement, cash flow statement or operating statistics for 2020 and the immediately preceding years reflecting decreased occupancy or utilization of manufacturing properties, hospitality or restaurant properties, including forced reduction in business operating hours due to state shutdown orders. A successful challenge due the COVID-19 pandemic means a reduced property tax bill for the investor until a reappraisal in a subsequent year, which could be up to three years depending on each county’s reappraisal cycle as mandated by state law.

The attorneys at DBL Law have the experience and unique abilities to help you with all of your real estate needs in Ohio and Kentucky, whether buying or selling, leasing, financing or challenging real property tax valuations of all types, as well as seeking relief for property reductions caused by the COVID-19 pandemic. Please contact Drew Emmert at (513) 357-5289.