Few people enjoy paying taxes. This can be especially true for business owners and even more so for those with commercial property. Though these taxes do go toward helping the state’s ability to support their business, part of that is understanding how to take advantage of any available deductions. Minnesota business owners pay a bit more in commercial property taxes than most of the country, so finding a break can significantly help local businesses succeed.
The Minnesota property tax code for commercial use is quite complex. Working with a law firm that is well-practiced in commercial taxes and appeals can help people save a considerable amount of money come tax season.
Don’t Miss Out On These Commercial Tax Breaks
Depending on the type of business you run, these tax breaks can help a company become more profitable or even become a benefit-rich asset. Proper application of these rules can help a Wayzata business succeed:
- Deductible mortgage interest. Commercial property owners can deduct the yearly interest they pay on their mortgage from their owed taxes. For example, if you pay $3,500 per month on mortgage interests, you can secure up to $42,000 in tax-deductible credits.
- Depreciation expenses. Many assets immediately begin to depreciate upon purchase, but the IRS allows commercial buildings to accrue depreciation credits for 39 years and help offset other taxes.
- Tax breaks for beneficiaries. Should you leave a commercial property to someone else upon your death, and they decide to later sell, they will only pay taxes on the amount that the value has increased since the time of their initial acquisition.
- Property improvement expenses. The costs of maintenance or improvement may also be deductible. A skilled attorney can examine your carefully itemized expenses for renovations and upgrades and help secure the deductions you deserve.
- Capital gains. Many people seek different investment opportunities to help fund their eventual retirement. Many people have an IRA (individual retirement account), but any money pulled out is taxed at a personal rate. Investing in commercial property means that you will be taxed on capital gains at the time of sale, which is a considerably smaller rate.
Securing due tax breaks is vital for a business’s success, especially in a state with a higher-than-average commercial tax rate like Minnesota. A local attorney familiar with complex property tax issues can help you find the credits you have earned or appeal any unfair rulings.