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The Lowdown on Real Estate Taxes on Cell Towers

Every landlord knows that any income-generating asset on their property is taxable. Whether you raise livestock on your land, run a bed and breakfast, or lease your land to a cell tower tenant, you make income. All these scenarios are considered income-generating assets, and you owe taxes to the federal government, state government, or both.

Just as you pay real estate taxes on your home or any other property, you’re obligated to pay taxes on a cell tower on your land. But should you pay the taxes, or can you get the cell tower tenant to pay it?

The answer is complicated! Just because it is the norm for landlords to foot the bill, it doesn’t mean you have to pay the taxes. Continue reading to know all about cell tower real estate taxes and find out who the liable party is.

Who Pays the Real Estate Taxes on Cell Towers?

Taxes are a critical point of discussion for cell phone companies, and Verizon devotes around 450 words to detail the tax provisions in the cell tower lease document. AT&T uses about 900 words for the same. Generally, most cell tower lease agreements state that if the real estate taxes increase due to the installation of the cell tower, then the property owner is liable to pay the increased taxes to federal and state tax authorities.

However, property owners can claim reimbursements from the cell tower tenant by submitting copies of the previous years and the latest tax bills. The tenant then reimburses the difference (increase in taxes) due to the installation of the tower. But there are some catches you need to be aware of first.

Beware of Time Limit on Tax Reimbursements

If you read your cell tower lease agreement carefully, you may notice that the landlord has thirty days to claim the reimbursement. While 30 days is the norm, some cell tower tenants have an extended time to one year. If the landlord fails to submit the reimbursement claim during this period, they are not entitled to the reimbursement amount. So, make sure to go through your cell tower lease agreement carefully to understand any stipulations.

How Long Does It Take for the Tenant to Process the Reimbursements?

The general rule is that once you send an invoice requesting reimbursement, the tenant has to reimburse you within thirty days. However, most cell tower lease agreements do not mention any date on when you can expect the reimbursement. If you have sent an invoice to the tenant but haven’t heard back from them within thirty days, follow it until you receive it.

If you’re obligated to pay the real estate taxes, ensure that you receive reimbursements from the cell tower tenants. If this provision doesn’t exist in your cell tower agreement, you can consult cell tower lease advisors to help you renegotiate the lease agreement to help you make the most profit from the arrangement.

Steve Kazella

I was recruited out of Enterprise Rent a Car in 2000 by Kevin Donohue, who is my business partner today, to be a real estate site acquisition manager in the NYC Metropolitan Area for his company that was contracting for Verizon Wireless, T-Mobile and Sprint. In 2008 I founded a consulting firm know today as Tower Genius, LLC where Kevin and I have helped many thousands of people and existing cell tower landlords get the help and information they need to succeed at the cell tower negotiating table.

Carriers & Tower Companies Have Their Hired Guns. Shouldn't You?

Negotiating a cell tower lease, trying to figure out what the correct cell tower rent value for your property needs to be, or evaluating the broad range of proposals and offers received by most cell site landlords in 2022 can be very confusing. Connect with Tower Genius or submit your info below, and we'll evaluate your situation, answer your questions and even make a few recommendations you may benefit from.

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