GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 2015

S                                                                                                                                                     4

SENATE BILL 159

State and Local Government Committee Substitute Adopted 3/24/15

Finance Committee Substitute Adopted 4/21/15

Fourth Edition Engrossed 4/23/15

Short Title:        Transferred Properties in Corrected Revals.	(Public)
Sponsors:
Referred to:

March 4, 2015

A BILL TO BE ENTITLED

AN ACT to require payment of additional taxes by the appropriate owners of record for corrected revaluations.

The General Assembly of North Carolina enacts:

SECTION 1.  Section 3 of S.L. 2013‑362 reads as rewritten:

"SECTION 3.  Interest on taxes paid on parcels with errors that resulted in the parcels having an overstated value shall be calculated at a rate of five percent (5%) per annum. Additional taxes levied on parcels as a result of errors causing the parcels to have an understated value (i) shall be treated as taxes on discovered property pursuant to G.S. 105‑312, except that the discovery penalties set forth in subsection (h) of G.S. 105‑312 shall not apply.apply, (ii) are due and payable on September 1 of the fiscal year for which the taxes are levied, but not earlier than four years from the last general reappraisal date, and (iii) shall be payable, at the taxpayer's option, by means of an agreement over a period of not more than 60 months if the total of the additional taxes levied is greater than one thousand dollars ($1,000). Interest shall not accrue for the period a taxpayer is making timely payments under a payment plan. Notwithstanding G.S. 105‑365.1(b), for parcels that have been transferred in a tax year for which errors requiring reappraisals under this act resulted in an underpayment of taxes, the following apply:

(1) The taxes for each tax year prior to and in the fiscal year in which the transfer occurred shall be collected from the owner of record as of January 1 of each tax year for which unpaid taxes exist. Only the remedies available in G.S. 105‑367 and G.S. 105‑368 may be used to collect against the owner of record as of January 1 of each tax year for which unpaid taxes exist.

(2) Notwithstanding G.S. 105‑355(a), there shall be no lien on the real property for underpaid taxes that arose in a year in which the property is owned by a person other than the current owner as of January 1 of that year. The current owner shall not be held personally responsible for such underpaid taxes.

(3) If an owner not responsible for underpaid taxes pursuant to this section paid the underpaid taxes, the owner may assert a valid defense for a refund pursuant to G.S. 105‑381, as a tax imposed through clerical error. Interest on the refund shall be calculated at a rate of five percent (5%) per annum from the date the owner asserting the defense paid the underpaid taxes until the date the refund is issued."

SECTION 2.  This act is effective when it becomes law.