Property tax abatements exempt all or part of an improvement for a set number of years. This encourages new construction or rehabilitation of a property. Abatements:
- Help revitalize communities and retain residents.
- Attract home and business owners to Philadelphia.
- Reduce development costs for commercial and residential projects.
Types of abatements
Development Abatement for New or Improved Residential Properties (State Act 175)
This is a 30-month abatement for:
- New, residential construction.
- Improvements to existing, unoccupied residential properties.
- Improvements to existing structures that are being converted to residential properties.
The abatement starts on the first day of the month after the building permit is issued by the Department of Licenses and Inspections (L&I).
Rehab Construction for Residential Properties (Ordinance 961)
This is a 10-year abatement for improvements to existing residential properties containing one or more units. It is not available for hotels.
The abatement starts on January 1st after the owner certifies that the improvements are complete.
You must file the certificate of completion and an affidavit stating the completion date with the OPA before the abatement value can be assessed and started.
Rehab & New Construction for Commercial & Industrial Properties (Ordinance 1130)
This is a 10-year abatement for new construction or improvements to deteriorated industrial, commercial, or other business properties.
The abatement starts on January 1st after the owner certifies that the improvement are complete.
You must file the certificate of completion and the certificate of occupancy issued by L&I. If an L&I certificate of occupancy is not needed, the owner must submit an affidavit stating the date the improvements were complete.
New Construction for Residential Properties (Ordinance 1456-A)
This is a ten-year abatement for new construction of residential properties. It is not available for hotels.
The abatement starts the first month after the title date.
Where and when
The type of abatement affects when you’ll submit your application.
- For abatements under State Act 175 or Ordinance 961, submit by December 31st of the year that the building permit is issued.
- For abatements under Ordinance 1130 or Ordinance 1456-A, submit within sixty days of the date when the building permit is issued.
You must submit your application to:
Office of Property Assessment, Abatement Unit
601 Walnut St.
Suite 300 W.
Philadelphia, PA 19106
Canceling an abatement
To cancel an abatement, all of the property’s owners must sign the cancellation form. If there are more than two owners, they can sign and submit additional forms. Once an abatement is removed, it cannot be put back on the property.
Properties with a 10-year residential tax abatement aren’t eligible for the Homestead Exemption. Once the abatement has expired, homeowners can apply for the Homestead Exemption.