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The ease of getting a permit for a finished basement depends on where you live and if the basement conforms to local and international building codes. In most cases, you will need to disclose of your finished basement, pay a permit fee, pass an inspection, and pay any unpaid taxes to get a permit.
So, somehow (and we won’t ask how), you’ve ended up with a finished basement and no permit. While it may seem rather intimidating to apply for a permit now, it is crucial for several reasons.
What follows is an in-depth breakdown of these steps, including the factors that may impact the process of getting your finished basement up to code and permitted.
Contact Your Local Building Department
This will be a confession of sorts. Whether you built it without permission (knowingly or unknowingly) or you purchased a house with an unpermitted finished basement (knowingly or unknowingly), you will have the same process to follow.
First, it may be helpful to visit your local municipality’s website for locally specified information. Every area is going to ask for different forms and applications, and the website can be a good place to find out what you’ll need. It may be helpful to call and ask for this information as well.
You will then visit your local municipal building to disclose your finished basement. Your visit will likely include filling out a permit application, turning in any necessary drawings or forms, and scheduling an appointment for your basement inspection.
If you are lucky, your state/area may not require a permit for finishing a basement, or the nature of the work that was done did not require a permit.
Pay the Permit Fee
Many contractors include the cost of permits in the cost of a remodel, but in the case that your contractor never pulled the correct permits, you will need to pay for the retroactive permits.
Even if you did not do the unpermitted remodel, i.e., it was done by a previous owner, you will have to pay the permit fee. As much as it is a hassle to buy a permit for someone else’s work when you may not have all the plans and information, it will be made up for when your house’s resale value goes up by a few thousand dollars.
It is possible that you will have to pay more for the retroactive permit, or you will be required to pay a fine on top of the regular fee. The retroactive permit fee varies and depends on where you live and what work was done, but it is usually between $2000 and $8000.
Some states, like Connecticut, do not charge a penalty fee. In this case, a regular basement remodeling permit will probably cost between $200 and $1000.
Allow the Basement to Be Inspected
A building inspector may request the previous house plans/finishing plans to see what work was done to the basement. Make sure to come with a good idea of the work that went into finishing the basement and the contact information of any contractors used during the renovation.
The benefit of getting building permits during renovations is that inspection can take place before much of the internal work (i.e., electrical, plumbing, etc.) has been finished and covered up. When inspection occurs after the fact, they might have to remove portions of flooring, drywall, ceiling boards, etc., to inspect the “hidden” work.
Try to expose whatever relevant renovations you can prior to the inspector’s arrival.
Make All the Changes Required
The reason that you are required to have a permit is to ensure that the finished basement is code compliant and thus safe.
If something is unsafe, it will need to be corrected. This may be something minor like moving an electrical outlet, or it may be something major like installing windows or breaking down a wall.
The International Residential Code (IRC) regulates several aspects of habitable basement spaces, including window height and accessibility, staircase dimensions, and ceiling height.
For example, IRC Section R305.1 states that basement ceilings must be no less than 7 feet in habitable areas and hallways and no less than 6 feet 8 inches in bathrooms and laundry rooms. Additionally, this code regulates the height of sloped ceilings, bathroom fixtures, and beams, so study it more in-depth to see what applies to you.
If your finished basement is not up to code height-wise, raising the ceiling will be cost and time-intensive, so always check your local building regulations to see if there is any leeway before undergoing these big projects.
If the renovations were carried out a very long time ago, you might be able to get some of the renovations grandfathered in even if they are not code-compliant according to today’s standards.
Certain building codes change often over time, so it isn’t cost-effective to renovate old buildings every time these codes change. Grandfather clauses allow old buildings to stay the same as long as they are not hazardous. Grandfather clauses do not apply to improvements in codes that regulate safety, including fire codes.
If your inspection resulted in code noncompliance, it may be worthwhile to look into grandfather clauses in your area’s building regulations. You may be able to dodge some costly renovations this way.
Will I Have to Tear Everything Out?
While possible, completely ripping out every improvement made is not likely to be required unless something foundational is non-code-compliant and to fix it means that the rest must be removed.
As mentioned previously, ceilings that are too low can cause a basement to break code and digging out a basement is an extremely costly structural procedure. However, this is a case when looking into grandfather clauses may help your situation.
It is unlikely that you will need to tear out your home renovations for not having a permit. Municipalities are more likely to punish an individual with fines than to rip out their home improvements, except in cases where there is extreme hazard being posed.
Address the Tax Issue
With a finished basement, your property value increases, and since property tax is usually some percent of property value, this will increase some amount as well, which depends on the location of the house and the extent of the remodel.
Since your remodel has not been disclosed, you may not have been paying the correct amount of property taxes since the basement remodel.
Because of this, you may be required to pay the taxes owed for the time that the basement was finished, and/or you may be fined. Now that you know, it is important to pay these overdue taxes and any more going forward to keep in compliance with the law.
Is It Worth Confessing?
Absolutely, yes. It is always best. The reason that you are unpermitted is highly unlikely due to the fact that you made a conscious decision not to apply. It is more likely that you didn’t know or it wasn’t you who made the changes.
Now that you know, the best course of action is to get a permit for your basement and get it up to code, which comes with many benefits.
Without unpermitted work, your house will have higher resale value and lower insurance rates. In fact, some insurance companies will drop a client altogether for having unpermitted work. Moreover, you cannot claim to be unknowingly paying the wrong amount for property taxes, which could lead to trouble.
And you will gain the benefit of peace of mind of knowing that your house is completely safe to live in.
Related article: What Happens if I Finish My Basement Without a Permit
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