Alabama Property Tax Update Archive
UPDATED March 2018
Alabama Legislature Requires Disclosure of Additional Information for Sales Comps in Tax Appeals
In March 2018, the Alabama Legislature passed a bill requiring certain disclosures for those intending to offer sales or lease comparables in tax appeals. SB182, which will be codified as Ala. Code (1975) §40-3-27, requires any party (taxpayer or taxing jurisdiction) introducing a sales or lease comparable in a tax appeal to disclose the following:
(1) whether the proposed comparable property was occupied or unoccupied at the time of the transaction; and
(2) whether the proposed comparable property was subject to any use, deed, or lease restriction at the time of the transaction that prohibits the property, on which a building or structure sits, from being used for the purpose for which the building or structure was designed, constructed, altered, renovated, or modified.
Under the new statute, the party introducing the sales or lease comparable must disclose this information at the time it offers the comparable into evidence. Failing to disclose the information carries a harsh penalty, resulting in the comparable being deemed inadmissible.
The new bill is effective immediately upon execution by the Governor, so taxpayers, counsel and appraisers must diligently review their sales and lease comps to ensure compliance with the new act.
Aaron D. Vansant, Esq.
DonovanFingar, LLC
American Property Tax Counsel (APTC)
UPDATED March 2017
2017 Alabama Protest Cycle Has Begun
The 2017 protest cycle has begun in Alabama. In Alabama, property tax valuation notices are sent out on a county by county basis, typically between March and August each year. Each county will have its own protest deadline, which is 30 days from the date of the valuation notice. Madison County sent out its 2017 valuation notices in early March, and protests there must be filed no later than Friday, April 7th.
Protests are heard by the Board of Equalization in each county. Appeals must be filed in Circuit Court within 30 days of the BOE’s final decision.
Assessors are only required to send notices for properties that have increased in value from the previous year, so an owner and/or its representatives must be aware of the deadlines in each county regardless of whether a notice is received. For the 2017 tax year, values are based on the property's "fair and reasonable market value" as of October 1, 2016.
Aaron D. Vansant
DonovanFingar, LLC
American Property Tax Counsel (APTC)
Updated June 2015
Alabama Protest and Court Appeal Deadlines are Upon Us
In Alabama, property tax valuation notices are sent out on a county by county basis, typically between April and August each year. For the 2015 tax year, values are based on the property's "fair and reasonable market value" as of October 1, 2014.
Each county has its own protest deadline, which is 30 days from the date of the valuation notice. Protests are heard by the Board of Equalization in each county. Appeals of the BOE's decision must be filed in Circuit Court within 30 days of the final notice.
Many counties in Alabama have already sent out their 2015 tax year values, and several protest deadlines have past, but many remain. Assessors are only required to send notices for properties that have increased in value from the previous year, so an owner and/or its representatives must be aware of the deadlines in each county regardless of whether a notice is received.
Aaron D. Vansant
DonovanFingar, LLC
American Property Tax Counsel (APTC)
UPDATED SEPTEMBER 2014
Jefferson County Real Property Valuation Notices Are "In The Mail"
The Board of Equalization for Jefferson County sent out the 2009 valuation notices on Tuesday, June 9, 2009. Jefferson County is home to metropolitan Birmingham and many of the surrounding suburbs. The valuation date for purposes of the notice is October 1, 2008 and will be the basis for calculation of the ad valorem tax bill due on each parcel for October 1st, 2009 (delinquent December 31, 2009). All tax parcels in Jefferson County will receive a notice even if the Board has not changed the value from that of the prior year. The address for the notice is the address that appears on the records of the Tax Assessor. Should any taxpayer or agent have a new mailing address, you may want to make sure the notice is forwarded to the new address or call the BOE directly (205-325-5566) for the new value.
A taxpayer has 30 days to file a written protest of the new valuation with the BOE. The BOE has instituted a requirement that protests be made via filling out and returning the yellow valuation notice card sent to taxpayers. We do not believe that failure to use the yellow card is justifiable grounds to deny a taxpayer the right to protest, however, good practice suggests that one should comply with the BOE's request.
While some of the procedures have changed, the information that the BOE is looking for remains substantially the same. For commercial real property, the BOE will typically consider the most recent three years of income and expense statements, as well as any comparable sales information that is presented. The BOE is also interested in any recent appraisals as well as information about the property that bears on its value, i.e., functional obsolescence, deferred maintenance, environmental issues, leasing problems, restrictive covenants, easements and servitudes. Information about comparable sales or leases, in the case of owner occupied property, is also helpful.
Typically, the BOE will send out the final results of all protests dated the same day. This is to prevent confusion as to the commencement date for the 30 day period to appeal to Jefferson County Circuit Court. Most taxpayers in Jefferson County who appeal real property results appeal pursuant to local legislation that allows for the value on appeal to be decided by a panel of three real estate professionals.
Benjamin J. De Gweck
DonovanFingar, LLC
American Property Tax Counsel (APTC)
UPDATED MARCH 2009
Ad Valorem Taxation in Alabama
Alabama law requires the assessment of both real and personal property and the levy of ad valorem taxes on both. Each purchaser of real property who owns such property on October 1 st is required to assess that property with the tax assessor (or, in some counties the revenue commissioner) between October 1 st and January 1 st. Once assessed, the taxpayer is not required to reassess each year unless there have been improvements made or some change in the status of the taxpayer or property occurs. The address of the taxpayer given at the time of assessment will control all subsequent valuation notices or other legal notices, so it is very important for each taxpayer to make sure that the address remains a good address from year to year. Changes in address can be accomplished by a simple letter to the tax assessor in the county where the real property is located. Anyone wishing to assess real property must present to the tax assessor evidence of ownership, such as a copy of a deed.
Personal property returns are made for all personal property owned by the taxpayer as of October 1 st of each year. The return is due by December 31 st. The assessment of such personal property is made by the tax assessor prior to the following October 1 st, and the tax due to be paid prior to January 1 st. Ad valorem real property tax is also due October 1 st, but not delinquent until January 1 st. Alabama law does not permit incremental payment of ad valorem taxes and interest accrues at the rate of 12% per annum on all unpaid ad valorem taxes.
Once the assessment is completed, the tax collector issues the bill. Alabama law has four classes of property and rates of assessment:
Class I – all property of utilities, 30%
Class II – all property not otherwise classified (commercial), 20%
Class III – all agricultural, historic, and residential, 10%
Class IV – pickup trucks for personal use, 15%
The amount of tax is calculated by multiplying the assessed value by the applicable millage rate in effect for the particular location of the property. Like most states, Alabama has numerous exclusions and exemptions to taxation that may be applicable. One of the most commonly overlooked exclusions is the broad exemption of inventory from personal property returns.
Appraisal and valuation in Alabama are conducted by the board of equalization for each of the 67 counties. Alabama law requires notice to the taxpayer if the value changes from the value assigned for the prior year. A taxpayer has 30 calendar days from the date of the notice within which to make a written protest of the valuation. A taxpayer has the legal right to a hearing before the board of equalization and the right to appeal the decision of the board to the circuit court of the county where the real or personal property is located. All appeals must be filed 30 days after the board decision. On appeal, either party may elect to have a jury selected to hear the case.
Benjamin J. De Gweck
DonovanFingar, LLC
American Property Tax Counsel (APTC)
