UPDATED june 2020

Covid-19 and Property Tax Appeals

Georgia Supreme Court Chief Justice Harold D. Melton issued three 30 day statewide judicial emergency orders due to the coronavirus, but the deadline for filing property tax appeals has not changed. Property owners must timely file appeals of their assessment notices or will have no right to contest their tax bills.  Assessment notices are used in April/May/June with a deadline of 45 days from the date of issuance. If an assessors' office changes the assessment in response to an appeal, a new assessment notice is sent to the taxpayer which also must be timely appealed, or the change is final. Taxpayers should watch carefully for a supplemental change notice because the filing deadline is much shorter than the initial filing deadline. Simple errors in the appeal process can be costly.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP.
American Property Tax Counsel (APTC)

Georgia Property Tax Update Archive

UPDATED March 2020

Taxpayer Wins Freeport Exemption Case

In Fayette County Board of Tax Assessors v. Walmart Stores, Inc. (A19A2238), (March 13, 2020), the Georgia Court of Appeals affirmed the trial court’s decision granting summary judgment for the taxpayer. The trial court held that the personal property at issue, self-checkout component parts held for fewer than 12 months and destined for shipment outside the state of Georgia, was not subject to ad valorem taxation because the freeport exemption under O.C.G.A. § 48-5-48.2(c)(3) applied to the property. The Court of Appeals held that the property fit into the category of finished goods as defined as “goods, wares, and merchandise of every character and kind.” and the property qualified as inventory as a list or quantity “of goods or materials on hand.”


Lisa F. Stuckey.
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED December 2019

Taxpayers Win Two Year Assessment Freeze Issue

In DeKalb County Board of Tax Assessors v. CWS SGARR Brookhaven, LLC (A19A1541), and DeKalb County Board of Tax Assessors v. WRH Aztec LLC (A19A1618), 2019 Ga. App. LEXIS 639 (October 30, 2019),  the Georgia Court of Appeals held that neither a significant increase in the sales prices of similar comparable properties in the same taxing neighborhood nor a general rise in the value of real estate in a particular neighborhood are statutory exceptions to the two-year assessment freeze provided for in O.C.G.A. § 48-5-299(c). The Court reiterated the permitted statutory exceptions to the assessment freeze which consist of: 1) a taxpayer’s failure to attend the appeal hearing or provide written evidence supporting its opinion of value; 2) the taxpayer filed a return at a different value during the next two years after an appeal; 3) the taxpayer files an appeal during the next two years after an appeal, and 4) if after a visual on-site inspection, it is found that there have been substantial additions, deletions or improvements to the property or that there are errors in the tax assessors’ records in the description or characterization of the property, or the tax assessors find an occurrence of other material factors that substantially affect the fair market value of the property. The Court specifically held that “other material factors” must be factors that an on-site inspection of the property would reveal and that they must be factors that are specific to the particular piece of property at issue.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED SEPTEMBER 2019

Condo Valuation Tied to Examination of Documents

In Glynn County Bd. of Assessors v. SIO Propco I, LLC, 2019 Ga. App. LEXIS 386 (June 25, 2019), the Georgia Court of Appeals reversed the trial court’s decision granting partial summary judgment for the taxpayer. The trial court held, as a matter of law, that the tax assessors were required to deduct the value of club membership rights from the price used to value certain interests in condominium units.  The Court of Appeals reversed, holding that the documents governing the sale and transfer of the units and membership in the club created an issue of fact as to the degree to which obtaining a club membership was bound up with the sale of the condominium units. The Court of Appeals also held that the trial court also erred in holding, as a matter of law, that the tax assessors were required to extract the value of specific percentages of annual club dues from the gross sales price of comparable sales to determine the values of other properties.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED JUNE 2019

Foreclosure Sale - Arm's Length or Not?

In DeKalb County Bd. of Tax Assessors v. Astor Atl, LLC, 2019 Ga. App. LEXIS 215, 826 S.E.2d 685 (April 1, 2019), the Georgia Court of Appeals held that a bank foreclosure sale pursuant to deed under power can be an arm’s length bona fide sale. The county board of tax assessors was precluded from valuing properties at fair market values higher than the amounts paid at the public auctions for the tax year subsequent to the year of purchase, pursuant to O.C.G.A. § 48-5-2(3). The fact that the sale may not be at true fair market value is irrelevant; the fact that the sale results in financial loss is irrelevant as well.


Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED MARCH 2019

Watch Your Appeal Deadlines in Georgia

It’s almost that time of year again in Georgia – time to start thinking about ad valorem property tax appeal filing deadlines. County tax assessors mail out assessment notices to all real property owners in Georgia in the April/May/June time frame. Be on the lookout for assessment notices for each parcel owned. Appeals must be filed within 45 days of the date of the assessment notice. If you fail to meet this deadline, it will be too late to appeal when you get your tax bill and are dissatisfied with the amount of taxes you owe.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP .
American Property Tax Counsel (APTC)

UPDATED december 2018

Tax Treatment of Stadium Questioned

In Love v. Fulton County Bd. of Tax Assessors, 2018 Ga. App. LEXIS 643 (Case No. A18A1778, decided on December 3, 2018), the Georgia Court of Appeals held that the trial court did not err in dismissing the plaintiffs’ claims seeking a writ of mandamus against the Fulton County Board of Tax Assessors (hereinafter “Board”).

Plaintiffs (taxpayers in Fulton County) had sought a writ of mandamus to compel the Board to investigate diligently under O.C.G.A. § 48-5-299 and determine whether the interest of the Atlanta Falcons Stadium Company in the Mercedes-Benz Stadium is subject to ad valorem taxation. The Court noted that the statute affords the Board discretion in the process it follows to investigate the taxability of property because the term “investigate diligently” is not statutorily defined. The Court also noted that mandamus relief would only be appropriate if the Board failed entirely to conduct an investigation into the taxability of the Stadium Company’s interest in the stadium. The Plaintiffs’ own amended petition and attached exhibits unequivocally demonstrated that the Board did investigate the issue and reached a decision thereon. The ultimate conclusion that the Board reached was that the property in question was not taxable since it was found to be a usufruct.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP.
American Property Tax Counsel (APTC)

UPDATED september 2018

Taxable Estate for Years on Non-Taxable Usufruct?

In Clayton County Bd. of Tax Assessors v. Aldease Atlanta Joint Venture, 2018 Ga. LEXIS 437, (Case No. S18A0430), decided on June 18, 2018), the Georgia Supreme Court affirmed the trial court’s grant of the retail operator’s motion for summary judgment in an ad valorem real property tax suit based on the ruling that their interests in the premises at issue constituted non-taxable usufructs. The comprehensive restrictions on the airport retailer’s right to use the leased space contained in the concession agreement were “fundamentally inconsistent with the concept of an estate for years” and therefore, the agreement at issue created a non-taxable usufruct and not a taxable estate for years. The Court also held that if the county was permitted to impose a property tax on the usufruct created by the concession agreement, it would violate the Georgia Constitution’s uniformity of taxability requirement since the county did not tax other usufructs or other possessory interests in its jurisdiction. Finally, the Supreme Court held that the trial court did not err in failing to find that the retailer owned leasehold improvements, as the retailer held only a usufruct and not an estate in real property..

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED june 2018

Taxable Estate for Years on Non-Taxable Usufruct?

In The City of College Park et. al. v. Paradies-Atlanta, LLC et al.,  2018 Ga. App LEXIS 318,  2018 WL 2454708, (Case No. A18A0162, decided on June 1, 2018), the Georgia Court of Appeals affirmed the trial court’s grant of the retail operators’ motion for summary judgment in an ad valorem real property tax refund suit based on the ruling that their interests in the premises at issue constituted non-taxable usufructs. The Court noted the evidence which showed: the City of Atlanta, which owns Hartsfield-Jackson International Airport, entered into seven-year agreements with the retail operators in the airport; the agreements specifically provided that the rights thereunder constituted a usufruct which is not subject to levy or sale and that no estate passed out of the City; the City of Atlanta retained dominion and control over the parcels by prohibiting the operators from subletting, assigning, transferring or encumbering any of their rights under the agreements without the City’s consent; the agreements restricted the hours during which deliveries may be made and by whom, the type of services offered, the prices that may be charged for good and services, the hours during which the businesses must be open at the airport, contained detailed customer-service requirements, business record retention and immediate access by the City, numerous City policy compliance rules on equal employment, non-discrimination, ethics, conflicts of interest, maintenance and upkeep requirements of the premises, as well as maintenance of certain types of insurance coverage. Although the agreements provided that the retail operators were liable for all taxes levied and assessed against their interests, they did not specifically address ad valorem real property taxes. The Court characterized the retail operators use of the premises as having “numerous pervasive restrictions governing nearly all aspects of the retail operators’ rights” and affirmed the trial court’s ruling that their interests in the parcels constituted non-taxable usufructs.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED March 2018

County's Failure To Schedule Settlement Conference Leads to a Loss

In Hall County Bd. of Tax Assessors v. Westrec Properties, Inc., 2018 Ga. LEXIS 42 (Case No. S17A1421, decided on January 29, 2018), the Georgia Supreme Court affirmed the trial court’s grant of the taxpayers’ motion for summary judgment based on the county Board of Tax Assessors’ failure to send notice of a settlement conference within 45 days of its receipt of the taxpayers’ notices of appeal and before certification of the appeals, as required by the amendment to O.C.G.A. § 48-5-311 (g)(2), which went into effect on January 1, 2016.  The Court held further that although the appeals were initially filed in the administrative process in 2015, the appeals were not considered filed until the date the taxpayers’ notices of appeal to Superior Court were filed with the Board of Tax Assessors, which was after the effective date of the new statutory amendment. The Court stated that the law means what it says: if the Board of Tax Assessors elects not to hold a settlement conference, the appeal terminates in the taxpayer’s favor, and if the taxpayer chooses not to participate in the conference, he loses the opportunity to seek fees and costs in Superior Court.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED December 2017

Public Property Exemption for Hospital Questioned

In Columbus Bd. of Tax Assessors v. Med. Ctr. Hosp. Auth., ___ Ga. ___, ___ S.E.2d ___ (Case No. S17G0091, decided October 16, 2017), the Georgia Supreme Court reversed the Court of Appeals’ decision which had affirmed the trial court’s decision that the hospital authority’s leasehold interest in a continuing care retirement facility was a “public property” and therefore, exempt from taxation. The Supreme Court held that the prior orders in the bond validation proceedings did not specifically decide the issue of taxability because the orders were not conclusive as to whether the leasehold interest of the hospital authority was “public property” for ad valorem property tax purposes; the superior court should have drawn its own conclusions about taxability. The case was remanded for a determination by the trial court as to whether the hospital authority held the leasehold interest for public purposes in furtherance of the legitimate functions of the hospital authority, rather than for private gain or income.  Mere ownership of property by a hospital authority does not exempt it from property taxes; bond validation proceedings that establish that bonds have a public purpose do not inevitably establish that the property associated with the bonds is public property.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

UPDATED SEPTEMBER 2017

Appraisal Procedures Manual Amended

GA. COMP. R. & REGS. r. 560-11-10-.08(3)(b)1. has been amended to provide clarification as to the appropriate form to use when filing for freeport exemption.  Subsection (i) provides that Form PT-50P, the "Business Personal Property Tax Return", is to be used for the return of business personal property, regardless of freeport.  It was previously used when the property owner was not eligible for freeport exemption or did not desire to file an application for freeport exemption.  Subsection (ii) provides that Form PT-50PF, the application for freeport exemption, is to be used only for the application for freeport exemption.  It was previously used for the return of business personal property and as a simultaneous application for freeport exemption. 

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

UPDATED JULY 2017

Have You Filed Your Appeal?

In May, Fulton County Tax Assessors sent out assessment notices that were dated May 19, 2017, and contained an appeal deadline of July 3, 2017.  However, due to an error in procedures, the notices were not timely mailed out.  The appeal deadline for those notices has been extended to July 10, 2017.  Appeals that are mailed must contain a US Postal Service postmark (NO private meter stamps) of July 10th or earlier.  Appeals filed online may be filed before 12:00 AM on July 11, 2017.  In all counties in Georgia, property owners must timely file appeals of their assessment notices or will have no right to contest their tax bills.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

Fulton County Notification
All property owners will receive a new 2017 Property Assessment Notice in August. If you have already submitted an appeal, it will be voided. You will receive official notice from the Board of Assessors. A new 45-day appeal window will begin with the date of the new notices.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

UPDATED MARCH 2017

Bill Proposes Revision to Definition of Fair Market Value

House Bill 285 proposes to revise the definition of fair market value as set forth in O.C.G.A. § 48-5-2.  The bill relates to the property tax treatment of affordable housing.  It provides that income tax credits may be considered in determining fair market value under the sales comparison approach if the tax assessor uses comparable sales that, at the time of the comparable sale, had unused income tax credits that were transferred in an arm’s length bona fide sale.  It also provides that for such rent restricted properties, the income tax credits may be considered in determining fair market value if such income tax credits generate actual income to the record title holder of the property.  As of this writing, the bill has passed the House and been favorably reported by the Senate.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated September 2016

Ad Valorem Tax Treatment of Low Income Housing Tax Credits Reviewed By Georgia Supreme Court

In Heron Lake II Apartments LP v. Lowndes Cnty. Bd. of Tax Assessors Supreme Court of Georgia, Civil Case (9/12/2016, 9/22/2016) S16A0691, the Court held that the superior court properly found that O.C.G.A. § 48-5-2 subsection (3) (B.1), which excluded low-income housing income tax credits from consideration for the purpose of assessing ad valorem tax, was unconstitutional as violating the taxation uniformity provision of the Georgia Constitution, Ga. Const. of 1983, Art. VII, Sec. I, Par. III (a).

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP 
American Property Tax Counsel (APTC)


Hospital Authorities and Property Tax
 

In Columbus, Georgia Bd. of Tax Assessors v. Med. Ctr. Hosp. Auth., ___ Ga. App. ___, ___ S.E.2d ___ (Case No. A16A00638, A16A0639, decided July 7, 2016), the Georgia Court of Appeals reiterated prior case law that held that hospital authority property is public property and is exempt from property taxes as long as the use of the property or its income furthers the legitimate functions of the hospital authority.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP 
American Property Tax Counsel (APTC)

 

Updated June 2016

Recent Property Tax Decisions 

In Park Solutions, LLC v. DeKalb County Board of Tax Assessors, 2016 Ga. App. LEXIS 183, the Georgia Court of Appeals held that real property purchased in a judicial foreclosure at a Sheriff’s sale was an “arm’s length bona fide” sale under O.C.G.A. § 48-5-2(3), and the sale price constituted the maximum allowable fair market value for the next taxable year for the one- year valuation freeze.

In Monroe County Board of Tax Assessors v. Wilson, 336 Ga. App 404 (2016), the Georgia Court of Appeals held that tax appeals not tried at the first available term of court after filing should not be dismissed by the trial court. 

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP 
American Property Tax Counsel (APTC)

 

Updated March 2016

Watch Your Filing Deadlines in Georgia

It’s about that time of year again in Georgia – time to start thinking about ad valorem property tax filing deadlines. Personal property owners are required to file returns with the county tax assessors by April 1. County tax assessors mail out assessment notices to all property owners in Georgia in the April/May/June time frame. So whether you are a taxpayer who owns real or personal property or both, you should be on the lookout for assessment notices for each parcel of real property owned and each personal property account. Appeals must be filed within 45 days of the date of the assessment notice. If you fail to meet this deadline, it will be too late to appeal when you get your tax bill and are dissatisfied with the amount of taxes you owe.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP 
American Property Tax Counsel (APTC)

 

Updated December 2015

Class Action Tax Refunds Permitted

In Glynn County v. Coleman, 2015 Ga. App. Lexis 675, the Georgia Court of Appeals reviewed the appropriateness of certification of a class seeking property tax refunds. The county governing authority asserted that the trial court erred in granting class certification in a class action of taxpayers who were seeking refunds of ad valorem property tax payments involving exemptions that had been allegedly miscalculated. The appellate court held that a class action against a county seeking property tax refunds is permissible under O.C.G.A. § 48-5-380, and the trial court did not err by granting class certification. The court also held that a county’s defense of sovereign immunity is not proper to avoid certification of a class.

Ragsdale, Beals Seigler, Patterson & Gray, LLP
Lisa Stuckey
Bill Seigler
Hal Gray
American Property Tax Counsel (APTC)

 

Updated September 2015

Fair Market Value Further Defined

In Ballard v. Newton County Board of Tax Assessors, 2015 Ga. App. Lexis 349, the Georgia Court of Appeals decided a case of first impression, namely, whether a tax sale qualifies as an “arm’s length bona fide sale” under O.C.G.A. § 48-5-2 (1). The Court held that a tax sale does not qualify as such under O.C.G.A. § 48-5-2 because a tax sale is a forced sale similar to a foreclosure sale (not a sale under normal conditions), and because the purchaser does not receive a fee simple title, but rather a defeasible fee interest evidenced by a tax deed. Consequently, the statutory one-year purchase price freeze of the tax assessment for arms’ length bona fide sales under O.C.G.A. § 48-5-2 (3) is inapplicable.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated June 2015

Governor Signs Bill Changing Tax Laws 

On May 6, 2015, Georgia Governor Nathan Deal signed House Bill 202 which makes a number of changes to the property tax laws. Some of the most significant changes concern the ad valorem provisions regarding arbitration in that O.C.G.A. §48-5-311 has been amended to allow for non-binding arbitration.  The statute still requires the appealing taxpayer to provide a certified appraisal to the county board of tax assessors within forty-five (45) days of the date of the county’s mailing of the acknowledgment of receipt of the taxpayer’s appeal.  In his or her award, the arbitrator considers the final fair market value submitted by the board of tax assessors at the hearing, the fair market value submitted by the taxpayer at the hearing, and the evidence supporting the values submitted by both parties.  The arbitrator’s decision as to fair market value determines which party is responsible for payment of the fees and costs of the arbitrator.  If the taxpayer's value is closest to the fair market value determined by the arbitrator, the county shall be responsible for the fees and costs of such arbitrator. If the value of the board of tax assessors is closest to the fair market value determined by the arbitrator, the taxpayer shall be responsible for the fees and costs of such arbitrator.  The arbitrator’s decision is appealable to Superior Court within thirty (30) days of the date of delivery of the decision.

Lisa F. Stuckey
Ragsdale, Beals Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated March 2015

Fair Market Value Definition Further Clarified

In CPF Ins. LLLP V. Fulton County Board of Tax Assessors, Case No. A14A2268, (March 3, 2015), the Georgia Court of Appeals held that it was error for the trial court to find that because the Federal Home Loan Mortgage Corporation is a governmental agency, its sale of real property did not qualify as an arm’s-length bona fide sale for property tax assessment purposes. The Court of Appeals also held that the trial court erred in holding that the sale price by Freddie Mac was not the maximum allowed fair market value for the succeeding tax year pursuant to O.C.G.A. § 48-5-2-(3). This statute clearly defines fair market value and has no language exempting sales involving governmental agencies; it applies to all sales of real property regardless of the identity of the parties as long as the sale is an arm’s-length, bona fide sale. O.C.G.A. § 48-5-2(.1) states that arm’s-length sales specifically include distress sales, short sales, bank sales, and sales at public auctions. Therefore, Freddie Mac’s financial loss as a result of the sale was insufficient to show that it was not acting in its own best interests. The Board of Tax Assessors had the burden of proving the sale involved either fraud or deceit, that there was some relationship or affiliation between Freddie Mac and the purchaser prior to the sale, or that Freddie Mac intended to benefit the purchaser in a way contrary to its own best interests.

Ragsdale, Beals Seigler, Patterson & Gray, LLP
Lisa F. Stuckey
William J. Seigler III
Herbert H. Gray, III
American Property Tax Counsel (APTC)

 

Updated December 2014

Attorneys' Fees Awards in Following Term of Court Are Enforceable

In Fulton County Board of Tax Assessors v. Toro Properties VI, LLC, 210 Ga. App. LEXIS 613 (September 8, 2014), the Georgia Court of Appeals held that attorneys’ fee awards issued in tax appeal cases after the term of court in which the final judgments were issued did not amount to an unauthorized attempt by the trial court to modify final judgments outside the term of court in which they were rendered. The court held that there is no requirement for the trial court to expressly reserve in the final valuation orders the right to later issue a few award, and such fee awards do not frustrate the interest of judicial economy or violate public policy, because there is no time limitation dictating when a taxpayer must move or a court must award attorney fees.

Lisa F. Stuckey
William J. Seigler III
Herbert H. Gray, III
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated September 2014

Obtaining Records for Tax Appeals

In Hansen v. DeKalb County Board of Tax Assessors, 295 Ga. 385 (2014), the taxpayer initially attempted to obtain copies of public real property tax records from DeKalb County via tax appeal statute O.C.G.A. § 48-5-306(d). The county provided certain documents, but the taxpayer was not satisfied with the adequacy of the responses. The taxpayer then requested more specific documents which the county responded to again. Thereafter, the taxpayer requested a meeting with the Chief Appraiser and notified the county the meeting would be recorded pursuant to state statute. After the Chief Appraiser declined the request, the taxpayer filed a petition for mandamus and for an order under the Georgia Open Records Act (O.C.G.A. 50-18-71 et. seq.) The trial court denied the taxpayer’s mandamus. The appellate court held that the trial court ruled correctly; the Act’s enforcement provisions do not apply to requests for information made pursuant to tax appeal statutes. Furthermore, the taxpayer should have availed himself of the remedies available in the administrative tax appeals process of O.C.G.A. § 48-5-311.

Lisa F. Stuckey
William J. Seigler III
Herbert H. Gray, III
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated June 2014

Refund Statute Amended; Time Period Adjusted

Effective July 1, 2014, O.C. G. A. § 48-5-380 will provide that taxpayers may, but are no longer required to, submit a refund claim to the county governing authority prior to bringing suit for taxes which have been erroneously or illegally assessed or collected. If a taxpayer files a refund claim, the time period before which a refund suit may be filed has been shortened from the earlier of the governing authority's denial of the claim or ninety days following the filing of the claim, rather than a one year waiting time. The new legislation also provides that no suit for refund may be filed more than five years from the date of the payment of taxes.

Lisa F. Stuckey
William J. Seigler III
Herbert H. Gray, III
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated March 2014

Potential Help for Low Income Housing Tax Credit Properties

The Georgia Legislature passed a bill during the 2014 session, which if signed or not vetoed by the governor, will be beneficial to low-income housing tax credit properties. The bill provides that for ad valorem property tax valuation purposes, the tax assessors shall apply rent limitations, operational requirements, and any other income tax or other regulatory restrictions associated with the use of the property as low-income residential rental property. The bill also provides, however, that such properties shall not be considered comparable properties for assessment or appeal of assessment of other properties.

Lisa F. Stuckey
William J. Seigler III
Herbert H. Gray, III
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated December 2013

If Appealing Property Taxes for 2014, Be Aware of New Law

New legislation in Georgia may impact commercial property owners who appeal their values for 2014 and future tax years. The law changes the method of calculation of the temporary tax bill. The previous law provided that if the bills were issued before the board of equalization rendered its decision, the bill would be based upon the higher of the return value for that year, or 85% of the year's value set by the county board of tax assessors. The new law provides a new calculation method if the tax bills are issued before the board of equalization hearing. Under the new procedure, the temporary value will be set to the lesser of: a) the valuation in the year preceding the year in which the appeal is filed, or b) 85% of the current year's value. Taxpayers pay 85% of the current year's value if the property has had structural improvements occur. Taxpayers also now have the option of electing to pay 100% of the current year's valuation if no property improvement has occurred. However, if taxpayers elect to pay less than 100%, the new law increases the maximum interest cap on taxes owed or refunds the county must pay for non-homestead property from $ 150 to $ 5,000 for the first sixty days. If the bill is not paid within 60 days after the postmark date of the new billing notice, the taxpayer shall owe additional interest at the rate of one percent per month until the bill is paid in full. If the refund is not paid within sixty days from the date of the final determination of value, additional interest shall accrue from the sixty-first day until paid at the rate of one percent per month with no limitation.

Lisa F. Stuckey
Herbert H. Gray, III
Brian J. Morrissey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated September 2013

Church Property Exemption Cases Turn on Fact Specific Details

The Georgia Court of Appeals recently issued two decisions concerning exemptions for places of religious worship. In First Congregational Church v. Fulton County Board of Tax Assessors, 320 Ga. App. 868, 740 S.E.2d 798 (2013), the Court affirmed the trial court's holding that the First Congregational Church's parking lot was not entitled to exemption because it was primarily used for the purpose of securing income for the Church under a third-party parking lot lease. In DeKalb County Board of Tax Assessors v. Presbytery of Greater Atlanta, Inc., 320 Ga. App. 312, 739 S.E.2d 764 (2013), a church leased property at below-market leasing rates to another non-profit religious entity which used the property as a place of religious worship; the Court of Appeals affirmed the trial court's holding that the property was entitled to exemption.

 

Updated June 2013

Georgia Court Of Appeals Misses Opportunity To Analyze The County Tax Assessors' Valuation Of Development Authority Property Leased To Developer Of Manufacturing Facility

The Development Authority of Fulton County, the Fulton County Board of Tax Assessors and a private developer of real property entered into a memorandum of agreement as to the valuation methodology the Board of Tax Assessors was to use in assessing ad valorem taxes on the property. The developer as lessee was to enter into a multi-year lease with the Development Authority (a tax exempt entity) as lessor/owner whereby the developer could acquire the fee simple interest in the property for a nominal amount at the expiration of the lease term. The memorandum provided that the Board would determine the fee simple market value of the property by the income approach and then determine the value of the manufacturer's leasehold interest by utilizing a "ramp-up schedule". That schedule would be based on the assumption that the value of the leasehold interest in the first year of the lease is 50 percent of the fee simple market value. The value would then increase by 5 percent each year as the lease term progresses and the manufacturer moves closer to receiving the benefit of its reversionary possessory interest in the property.

The Georgia Supreme Court previously held in Sherman v. Fulton County Bd. of Tax Assessors, 288 Ga. 88, 89, 701 S.E.2d 472 (2010) that in order to prove that a valuation method for valuing a leasehold estate was neither arbitrary nor unreasonable, there must be evidence establishing that the valuation method followed an authorized appraisal approach. The factors to be taken into account by the taxing Board are the terms and conditions of the lease, the nature and location of the property involved, the fair market value of similarly leased property and the prevailing rents in the area. Furthermore, after the initial valuation of the fee simple estate the taxing Board must then offer evidence that the ramp-up method employed incorporates the aforementioned factors.

In the recent case of Sherman v. Dev. Authority of Fulton County, A12A2111, (Ga. App.) March 22, 2013, the trial court's order contained only summary conclusions that contained no actual factual findings and conclusions of law which cited no legal authority or analysis as to how the conclusions were reached. On appeal, the Georgia Court of Appeals remanded the case to the trial court to enter a new order with specific factual findings and conclusions of law to explain why and how the appraisal method used by the Tax Assessors to value the leasehold estate is neither arbitrary nor unreasonable, and therefore legally valid.

 

Updated March 2013

New Georgia Law Paves the Way for Potential Tax Increase for Some Property Owners

O.C.G.A. § 48-5-2(3), which became effective January 1, 2011, provides that the sale amount for arm's-length transactions shall be the maximum allowable fair market value for property tax purposes for the next tax year. The effect of this new statute is that purchasers who acquired their properties during 2011 received assessment notices for the 2012 tax year from counties at values that were capped at a value that was no higher than the 2011 acquisition price. For tax year 2013, however, the restriction on valuation will not be applicable and county assessors will be permitted to review market sales and if in their opinion there is evidence to support an increase in value, they will have the authority to issue an assessment notice at a value that is higher than the purchase price. Readers can see more detailed information about this issue in the Southeast Real Estate Business Magazine in the October issue.

 

Updated December 2012

No Property Tax Charity Extended Georgia Public Charity

The Georgia Court of Appeals recently reiterated the long standing general principle that taxation is the rule, exemption from taxation the exception, and claims for exemption from taxation should be construed in favor of the State and against taxpayers in H.O.P.E. Through Divine Intervention Inc. v. Fulton County Bd. of Tax Assessors. Georgia Court of Appeals Case No A12A1100, November 16, 2012. This case held that a purely public charity was not entitled to tax exemption on certain property it owned because, for the tax years at issue, the charity owning the property, while constructing and renovating it, did not use it for the charitable pursuits of the owner. Since no individual or family had benefited from the charitable services of the taxpayer, the Court stated that it strictly construed taxation statutes and would not find an exemption unless it was clear that the legislature intended such exemption.

 

Updated September 2012

2010 Legislation Affects Property Tax Bills This Year

Modest property tax relief, in the form of legislation providing for the gradual reduction and elimination of the state property tax portion of the ad valorem tax levy, was passed by the Georgia House of Representatives and Senate and signed by the Governor in the 2010 session. This bill does not impact penalties, interest liabilities, and refund eligibility for prior tax years and begins to provide the intended relief with the 2012 property tax bills. The levy for tax year 2012 will be .20 mills, and further gradual reductions will occur each year thereafter until the state portion is eliminated in tax year 2016. Taxpayers will receive a notice on their property tax bills each year of this reduction. For the average homeowner this will have minimal impact, but for commercial property owners the tax savings could be substantial.

 

Updated June 2012

New Legislation Signed By Governor Creates Tax Appeal Court

House Bill 100, signed by Governor Deal on April 19, 2012, creates an independent Georgia Tax Tribunal within the Office of State Administrative Hearings for aggrieved taxpayers to appeal decisions of the Georgia Revenue Commissioner. In addition to the various other types of appealable taxes, the jurisdiction of the Tax Tribunal for ad valorem property tax purposes is limited to only certain types of taxpayers under Chapter 5 of Title 48 - public utilities under Article 11 and airline companies under Article 12. Taxpayers filing actions with the Georgia Tax Tribunal will not be required to pay taxes admittedly owed on their due dates, and electing not to pay the taxes during the pending appeal shall not be grounds for dismissal of the appeal. Certain written decisions of the Tax Tribunal shall be appealable to the Superior Court of Fulton County.

 

Updated March 2012

Appellate Cases Interpret Tax Appeal Arbitration Statute

The Georgia Court of Appeals recently issued two decisions interpreting certain provisions of the tax appeal arbitration statute. In Fulton County Board of Tax Assessors v. Greenfield Investment Group, LLC, (Case No. A11A1671, decided Nov. 17, 2011), the Court held that there are two 45- day periods specified in O.C.G.A.§ 48-5-311 (f) (3) (A). The first is the period following a board's receipt of the taxpayer's appraisal, within which the board must formally decide to accept or reject the taxpayer's appraised value. The second is the period following a board's decision to reject the appraised value, if it so decides, within which the board must certify the taxpayer's appeal to the superior court so that the arbitration process can begin. In Fulton County Board of Tax Assessors v. Fast Evictions, LLC, (Case Nos. A11A2155, A11A2156, A11A2157, decided Feb. 16, 2012), the Court of Appeals held that the language of O.C.G.A. § 48-5-311 (f) (3) (A) does not pertain to a time for taking action, but expressly specifies the effect of failure to take timely action (failure to timely accept or reject the taxpayer's appraisal value results in the certified appraisal value becoming the final value) and therefore, is a mandatory provision which must be enforced rather than a discretionary provision.

 

Updated December 2011

Property Tax Returns and Appeals in 2012

With Georgia approaching its second year in the new property tax regime, a few points are in order. First, the personal property tax return for business owners in Georgia is due on or before April 1 of 2012. While a real estate property tax return can be filed by April 1, it is now discouraged. The 45 day appeal period regarding real estate values now runs from the date of the annual property tax assessment notice sent to the taxpayer. This means that property tax attorneys and representatives, who have traditionally pro-actively filed returns asserting a lower value, must rely on timely receipt of the tax assessment notice from the client, who may not be schooled in the need to send them such notification. This is a good time to make sure that clients are aware of the changes and that the appropriate notification procedures are in place.

 

Updated September 2011

Obsolescence in Hard Times

In an uncertain economic climate, and coupled with a declining or stagnant real estate market, the means to ensure reasonable and accurate personal property assessments should include the concept of obsolescence, both functionally and economically. Georgia regulations regarding property assessments by county boards of tax assessors require that any obsolescence be taken into account. Ga. Comp. R. & Regs. r. 560-11-10-.02 (d) (2010).

Functionality analysis applies uniformly regardless of economic conditions, especially for equipment. The tax return may incorporate an aspect of this concept in applied depreciation schedules. Poor economic times or other functionally-related drags on use may exaggerate the obsolescent component of the already depreciating asset.

Economic deterioration of markets, particularly long-term downward trends in specific industries, is an additional component of obsolescence. Educating the tax representative of the assessing body is essential due to lack of understanding or familiarity with the intricate and sometimes complex analysis required to apply economic obsolescence.

Brian J. Morrissey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated June 2011

Taxpayers Should Remember New Definitions in Georgia Law

Taxpayers who intend to file property tax appeals for tax year 2011 should be aware of several new key definitions under the law effective January 1, 2011. Amendments to O.C.G.A. ' 48-5-2 provide that arm=s length bona fide sales shall now include distress sales, short sales, bank sales, and sales at public auction; the tax assessor in determining fair market value now must apply, rather than merely consider, bank sales, financial institution-owned sales, distress sales or any combination thereof, of comparable real property. Further, the transaction amount of the most recent arm=s length bona fide sale in any year shall be the maximum allowable fair market value for the next taxable year. These new definitions may prove beneficial for taxpayers owning property within taxing neighborhoods or jurisdictions containing the various forms of distress sales that tax assessors in the past deemed irrelevant. And, of course, any appeals must be filed properly and promptly within 45 days of the date of the notice.

Lisa F. Stuckey
Herbert H. Gray, III
Ragsdale, Beals, Seigler, Patterson & Gray, LLP
American Property Tax Counsel (APTC)

 

Updated March 2011

Freeport Exemption Determined by Sale in-State

In Muscogee County Board of Tax Assessors v. Pace Industries, Inc., (Ga. App. 2011), the Court of Appeals held that the statutory freeport exemption from personal property tax is determined by the location of the sale of the inventory, and not the location of the sale of finished goods incorporating the inventory.  The applicant Pace Industries shipped barbeque grill bodies from its Arkansas plant to a warehouse in Columbus where they were stored, then sold and delivered as needed to a barbeque grill manufacturing company located in Columbus.  The manufacturing company then incorporated the grill bodies into finished barbecue grills and shipped them to customers outside Georgia.  The Court held that as far as Pace was concerned the final destination of the grill bodies for which it sought freeport exemption was the plant it sold them to in Columbus.  Accordingly, the final destination for Pace’s inventory (the grill bodies) was not outside this state, and therefore the inventory was not entitled to freeport exemption under O.C.G.A. §48-5-48.2.

 

Updated December 2010

Supreme Court Rules for Property Owner

The Georgia Supreme Court ruled in favor of exemption for a nonprofit charitable institution even though it receives incidental rental revenues from the facility it owns and operates. The Court held that the property owner met all of the necessary criteria for exemption because it is an institution devoted entirely to charitable pursuits, the charitable pursuits are for the benefit of the public, and the use of the property is devoted to the charitable pursuits. The Court clarified the meaning of the 2007 amendment to the exemption statute by stating that the General Assembly must have intended to allow institutions that otherwise qualify as a purely public charity to use their property to raise income from activities that are not necessarily charitable in nature, as long as the primary purpose of the property is charitable and the income is used exclusively for the operation of the charity in pursuing its charitable purposes.

 

Updated September 2010

New Law Aids Taxpayers

A new law effective January 1, 2011 provides a measure of protection for taxpayers who choose to use counsel. The new law relieves a taxpayer from the burden of keeping up with notices, hearing times, dates, certifications, and other official actions if the taxpayer authorizes the attorney in writing to act on his behalf.

For taxpayers who provide the written notice, all such communications will be provided to the attorney instead of to the taxpayer. This can be a safety net for taxpayers with multiple corporate locations or large corporate infrastructures as well as taxpayers with few locations who simply need assistance in the tracking of tax related matters.

 

Updated June 2010

New Statute Brings Major Property Tax Changes

The Georgia governor recently signed into law a bill which changes property tax appeals in several ways. The most significant change is that counties must issue assessment notices to all taxpayers every year. Return deadlines are changed to a uniform date of April 1st and appeal times are standardized to 45 days. The arbitration procedures have been overhauled, regional boards of equalization may be established by agreement between counties, and a new hearing officer procedure has been provided for which certain taxpayers may elect to use instead of the board of equalization or the new arbitration procedures. In addition, there are specified instances where income must be considered by the tax assessors in valuations, and certain business intangible items may not be considered. Parts of the bill went into effect upon signature by the governor; other parts do not become effective until January 1, 2011.

 

Updated March 2010

Property Taxes Leap Into The Headlines

As we warned, 2009 was a critical year for Georgia taxpayers to be proactive in filing returns of fair value. Relatively few taxpayers did, despite pleas and plummeting property values, resulting in the predicted gnashing of teeth by taxpayers who received no property tax assessment reductions but higher tax bills from increased millage rates; they have no remedy.

One result is an unprecedented series of articles in the Atlanta Journal Constitution (ajc.com) running for eight consecutive days entitled "Why you're paying too much in property taxes." The Sunday article alone dominated the front page and four full interior pages. While the articles stress residential inequities between stated and actual property values, the same applies even more so to commercial and industrial valuations. Atlanta was especially impacted because of county-wide reassessments carried out in 2007 which impacted 2008 values before the plunge. Subsequent articles targeted each of the major Atlanta metropolitan counties and the responses and defenses of the county property tax officials regarding actions they took.

While it is too late to address 2009 inequities where no return was filed, once again we urge taxpayers to file returns proactively asserting the proper values prior to March 1 or April 1, 2010, depending on the county. It is critical to retain professional help to make sure the returns are properly filed and that appropriate analysis is done to ascertain and to assert a proper and defensible value; relying upon counties to reduce assessed values in 2009 was fruitless, and relying upon them to do so in 2010 is nothing less than reckless. Values may well remain locked into 2008 prices (much less 2009) with rocketing millage rate increases (Gwinnett County, for example, increased its millage rate by 21%.) In Georgia property tax returns cannot be ignored, and appropriate action must be taken no later than April 1 (and in some counties, by March 1.)

Owners and advisors waiting for new notices may be sadly disappointed because many counties may again not sent out new notices, hoping to keep existing values. If the value is the same, there is nothing to appeal, and the debacle of 2009 will be repeated in 2010, only worse. If you want the proper value on your property in Georgia, you must timely assert it and defend it.

 

Updated September 2009

Review Property Tax Billings Carefully

It is an unusual year in Georgia for property tax billings. In years past by this time of year most property owners had some reasonable expectations about their property tax obligations. But this year a number of counties and cities in Georgia have not finalized or even issued their billings. Several metro area counties have issued temporary tax bills. In late August a Fulton County Superior Court granted a temporary collection order for county property tax bills, and in Gwinnett County temporary tax bills were recently mailed because the total millage rate has not been set by the county board of commissioners. A number of municipalities have not established their millage rates also. Most likely rebillings will occur and additional charges will be issued to taxpayers. However, some counties have not issued temporary billings, so taxpayers should review their bills carefully to determine the type of bill they received. Georgia does not permit appeals from bills, so whether the bill is a temporary one or not, there will be no further relief for those who have not already filed appeals from assessment notices.

 

Updated June 2009

New Tax Legislation In Georgia

The governor has signed three new bills affecting property tax issues in Georgia. S.B. 55, amending O.C.G.A. § 48-5-2, mandates that tax assessors consider foreclosure, bank and other financial institution owned sales, distress sales, and any combination of comparable real property transfers in determining fair market value. H.B. 233 (now O.C.G.A.§ 48-5B-1) provides a moratorium period for taxable years beginning January 1, 2009 and continuing until January 9, 2011. Property taxable values cannot be increased above 2008 values except under certain circumstances: property additions or improvements, ownership transfer, rezoning, subdivision, or combination which changes property use, property factual error corrections. This law does not take effect until tax year 2010 for counties that performed or contracted for a comprehensive county-wide revaluation. The third new law, S.B. 240 amends O.C.G.A. § 48-5-311 to provide for an optional binding arbitration procedure in which a single arbitrator will decide the property value in lieu of that determination being made by a board of equalization hearing or non-binding arbitration.

 

Updated December 2008

A Critical New Year For Filing Returns Which Are Due Soon

This is a critical year for metropolitan Atlanta-area taxpayers to be proactive in filing returns of fair value. Failing to do so may leave taxpayers with excessive taxes based on valuations or appraisals performed long before the economic downturn -- which are now irrelevant to current market evaluations. Valuations based upon any appraisal or sale before August, 2007 are suspect. The taxing authorities may be basing taxes upon evaluations on vacant properties or which produce far less revenue than anticipated. Owners and advisors anticipating new evaluations in 2009 will be sadly disappointed because many counties will not send out new notices, hoping to maintain existing tax appraisal values, particularly if property owners have not registered an objection to the existing value by filing a new return indicating a lower value. If there is no new notice, the value remains the same, and there is nothing from which to appeal.

In Georgia, taxpayers file returns of fair market value (as of January 1) by either March 1 or April 1, depending upon the county of the location of the property. In most counties, returns must be received by the taxing authority by the deadline or postmarked by the US Postal Service (NO private meter stamps) by the deadline. Check with each county if postmarks are permitted. This is not a year where appeal rights will be nearly as important as returns, because most property values may well not be changed by the assessors.

If no return is filed for 2009, it is as if the same property is returned as the preceding year and at its previous final evaluation. Those who disagree with last year=s evaluation and do not file returns will lose their appeal rights, a devastating mistake and major trap for taxpayers who expect a notice from which they can appeal. Values merely carry forward from year to year unless a return is filed in a timely manner, which is much earlier than the tax notices regarding any changes are mailed. Literally hundreds if not thousands of taxpayers will experience major surprises when they receive no notices but later do receive tax bills based upon the 2008 evaluation (and possibly at an even higher millage rate) and have no recourse.

If a value were established by an appeal, the value carries forward for the next two years, unless it is returned at a different value or if changes to the property affect its value. If the final value in an appeal is satisfactory for the next year, no return should be filed; however, continued scrutiny and vigilance are required in a period of declining values.

Atlanta and other Georgia communities had dramatic upward revisions in property assessment valuations for commercial and industrial properties in 2008 despite major reductions in actual real estate values. Landowners and their representatives should reevaluate their properties= fair market values and act timely to assert and to establish those values with the taxing authorities, addressing problems early with capable advisors. Advisors should be proactive in informing and working with their clients early and aggressively. Unfairly high taxes can be the death knell for properties, resulting in lower values, forced sales and even foreclosure because of the inability to service the taxes, insurance based on the high values, and debt service where refinancing or restructuring is difficult if not impossible. The need for early action and professional involvement in the first month or two of the new year is essential for the property owner to have the best chance to establish a fair, current, sustainable and reasonable value.

 

Updated September 2008

Tax Appeal Interest Provision Changed

Once a County Board of Equalization has rendered a decision on an administrative appeal, that value is used for the computation of tax liability during the pendency of a subsequent judicial appeal. Any overage is to be paid from November 15th of the tax year in question or the date that the final installment of the tax is due, plus interest at one percent per month, subject to a $150.00 limit O.C.G.A. § 48-5-311 (g)(4)(B)(iii).

Effective May 14, 2008, the statute was amended to provide that refunds shall be paid to the taxpayer within 60 days of the last date upon which an appeal may be filed or the date the final determination of value is established on appeal, whichever is later. Refunds paid after the sixtieth day accrue interest at the rate of one percent per month until paid. The prior statutory provision that provided that interest shall accrue for a period of no more than 180 days was deleted. O.C.G.A. § 48-5-311(m).

 

Updated June 2008

Did You File Your Appeal?

In mid-April, Fulton County Tax Assessors sent out assessment notices from the first complete revaluation of 24,000 commercial properties in more than fifteen years, with a median increase of 44%. Other Georgia counties also mailed out assessment notices or will be very soon. Property owners must timely file appeals of their assessment notices or will have no right to contest their tax bills. Because Fulton County completed a county-wide revaluation, its assessors have no deadline for determining whether a change is merited as a result of a taxpayer's appeal. If an assessors' office changes the assessment in response to an appeal, a new assessment notice is sent to the taxpayer which also must be timely appealed, or the change is final. Taxpayers should watch carefully for a supplemental change notice because the filing deadline is much shorter than the initial filing deadline. Simple errors in the appeal process can be costly.

 

Updated March 2008

GA. Supreme Court And Us. Supreme Court Decide Georgia Tax Cases For Taxpayers

In Monroe County, et al. v. Georgia Power Company, Case No. S07G1156, decided January 8, 2008, the Georgia Supreme Court ruled that for the taxation of public utilities, county boards of tax assessors lack the authority to alter the State Revenue Commissioner's determination of fair market value and its proposed apportionment, but do have the authority to alter the assessment ratio he proposes based on the most recent records uniquely available to each county.

In CSX Transportation, Inc. v. Georgia State Board of Equalization, et al., 128 S. Ct. 467, 552 U.S._____ (2007), the United States Supreme Court held that federal statutory law allows a railroad to attempt to show that state methods for determining the value of railroad property result in a discriminatory determination of true fair market value.

 

Updated December 2007

The New Year Means Returns Due Soon

Taxpayers file returns of fair market value as of January 1 by either March 1 or April 1, depending upon the county. In most counties, returns must be received by the taxing authority by the deadline or postmarked by the US Postal Service (NO private meter stamps) by the deadline. Check with each county if postmarks are permitted. Applications for freeport exemption should also be filed at this time.

If you do not file a return, your property is deemed to be returned at last year's value.

Those who disagree with last year's value and do not file returns can lose appeal rights.

However, if a value was established by an appeal to arbitration or the Board of Equalization, the value carries forward for the next two years, unless it is returned at a different value or if changes to the property affect its value. If the final value in an appeal is satisfactory for the next year, then do not file a return.