Abatement

DEFINITION of 'Abatement'

A reduction in the level of taxation faced by an individual or company. Examples of an abatement include a tax decrease, a reduction in penalties or a rebate. If an individual or business overpays its taxes or receives a tax bill that is too high, it can request an abatement from the tax authorities.

BREAKING DOWN 'Abatement'

A common type of tax abatement is property tax abatement. Individuals who believe that the assessed value of their property is too high, can appeal to their local tax assessor for a tax abatement. Some localities offer property tax abatement to owners who restore, or improve, historic properties located in designated neighborhoods. Some types of properties, such as those containing non-profit businesses, will be granted tax abatements based on the owner's tax-exempt status.

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RELATED FAQS
  1. How can I obtain an abatement for property taxes?

    Depending on where your property is located, your local city or county government may offer a property tax abatement program. ... Read Full Answer >>
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    The Internal Revenue Service (IRS) frequently imposes interest and penalties due to the late filing of a tax return, underpayment ... Read Full Answer >>
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