Property (ad valorem) taxes are taxed on real and/or business personal property.
- Real property includes land and improvements: an improvement is anything that adds value to real property such as a house, manufactured home, swimming pool, gazebo, chicken house, barn, etc.
- Business personal property refers to items which are used in any business and are movable or not permanently fixed to the land.
Important Annual Dates
- October 1: Real Property Taxes are due and payable through December 31.
- January 1: Taxes become delinquent. Payments on or after this date will be charged delinquent tax fees plus 12% (annual) interest.
- January 1 - Filing of personal property for new tax year has ended and a late fee will be assessed.
- January 1 - Current Use applications must be filed for the new tax year. No exceptions will be given.
- January 1 - Last day to make payments by personal check. After January 1, all methods of payment must be certified funds such as cashier's check, credit/debit card, or cash.
- Month of March: Court notices are mailed to all delinquent accounts.
- Month of April - Delinquent properties are advertised for sale in the local newspaper for three (3) consecutive weeks..
- Month of May - Annual tax sale is scheduled for the second Thursday (normally).
What do I do when I buy real property?
The responsibility for assessing property (telling the Revenue Commission you have bought property and what it is used for) lies with the owner. In other words, it is up to the respective owner to ensure all necessary steps for assessment of properties have been completed.
At a minimum, the following steps should be completed:
- Record your deed in the Probate Judge’s Office.
- Assess your property in Revenue Commissioner’s Office.
- Claim any exemption due you. Make sure all of this is done no later than December 31 for all property purchased by October 1. Please report promptly all address changes.
- Make sure the taxes are current and paid on the purchased property.
What do I do if I add or remove improvements?
Improvements are defined by the State of Alabama as “anything that adds value to land,” such as a house, manufactured home, swimming pool, garage, gazebo, chicken house, barn, etc.
The Alabama State law requires that owners or their respective agents must come to their respective County’s Revenue Commission Office no later than December 31 to sign an assessment officially reporting any improvements made to or any removal of structures or features from their properties. Any change made on or before October 1 of that calendar year will be reflected on the next year’s tax statement. (Changes made after October 1 of that same calendar year will not be reflected on the next immediate statement but rather will be reflected up to two years later.)
Examples of improvements that are assessable would include new structures or additions, swimming pools, extensive repairs, remodeling, or renovations (such as adding a fireplace, extra bathroom, patio, deck, carport, garage, etc.). Items such as re-roofing, minor repairs and painting, (normal maintenance items) do not require reassessment.
Homestead Exemption Codes and Definitions
Primary residences are eligible for homestead exemptions, which exempt portions or all of the applicable property taxes. Primary residence is further defined as owner occupied home to include the land attached. Only one home or manufactured home can take the homestead exemption. Other residences owned may qualify for residential class or commercial class based on the usage.
The following exemption codes and definitions explain each exemption and conditions for application to owners' properties:
- H1 is a standard homestead exemption. This exemption applies to primary residences and adjoining land only.
- H2 is a homestead exemption for persons age 65 or older with a combined State adjusted gross income less than $12,000. This exemption applies to primary residences and adjoining land up to 160 contiguous acres.
- H3 is an exemption for persons who have obtained a 100% disability rating from Social Security, Veterans Administration or by a primary physician certifying the disability OR for those persons who are age 65 or order with a combned Federal net taxable income of less than $12,000. This exemption applies to primary residence and adjoining land up to 160 contiguous acres.
- H4 is an exemption for persons who are age 65 or older with a combined Federal net taxable income of more than $12,000. This exemption applies to primary residence and adjoining land up to 160 contiguous acres.
Exemptions H2, H3 and H4 are recertified each year by completing a new exemption card and returning the same to the Revenue Commissioner.
The Revenue Commissioner is responsible for determining property value, which must, by law, be set according to “fair and reasonable market value." Each tax year, beginning on October 1, market data is gathered using the information provided with land sales and recorded with the deeds of conveyance. Only sales resulting from an arm 's length transaction" between a " willing seller, neither being under any pressure to buy or sell will be studied to determine the current market values.
If you feel your property value is incorrect you may file a written protest with the County Board of Equalization. Upon your appeal, if time permits, you will be contacted by the county appraiser to review your valuation. If, after this review, you are still not satisfied with your valuation, a hearing will be set for you to formally meet with the Board of Equalization to present information you feel justifies a change in value. Following this hearing you will be notified of the decision of the Board of Equalization. You may appeal to Circuit Court within 30 days of their decision.
In order to preserve your right to carry the appeal process to Circuit Court, taxes must be paid by December 31, or a bond filed in Circuit Court in double the amount of taxes due.
In the State of Alabama, there are four classifications of property on which ad valorem taxes are assessed. These classifications reflect the property type and designated use as indicated by the property owners. Any property that is not assessed by its owners under Class I, Class III, or Class IV is automatically assessed as Class II property.
|Class I – Property Owned by Utilities||30%|
|Class II – All Other Property||20%|
|Class III – Agricultural Property & Owner-Occupied Residential Property||10%|
|Class IV – Private Passenger Vehicles||15%|
To determine the assessed value of a property, the classification rate is multiplied by the appraised value of the property (Appraised Value X Class % = Assessed Value). Taxes are based on Assessed Value, less any qualifying exemptions.
Assessment of Property
Each taxpayer is required by Alabama Law (Code 40-7-1) to provide a complete list of all of his or her owned property. Any and every person acquiring property is responsible for reporting to the Revenue Commissioner a complete legal description of the property and should at that time claim any exemptions for which he or she is eligible. Every owner is responsible for providing to the Revenue Commissioner his or her correct mailing address for all properties. All property owners must report any changes in ownership to the Revenue Commissioner.
Real and personal property taxes are paid in arrears; the tax year begins on October 1 and ends September 30 of the next calendar year. (All assessments on record as of October 1 of each calendar year are due and payable the following October 1.)
Taxes on motor vehicles are paid in advance and are paid throughout the year on a renewal scheduled based upon the first letter of each respective owner’s last name.
The Alabama Manufactured Home Act (91-694) signed into law on July 18, 1991 changed the way manufactured homes are treated for tax and revenue purposes in Alabama. Under this Act, those manufactured homes located on an owner’s property and not held for rent or lease will be assessed on the real property tax rolls in the Revenue Commission Office. All others must be registered.
Proof of ownership, along with a description that includes size, ID number, year made and model of the manufactured home must be brought to the respective County’s Revenue Commission Office to make an assessment. Each manufactured home owner will receive a decal to display on the right front corner of the home as proof that the taxes are paid.
A homestead exemption may be claimed by an owner-occupant of a manufactured homes provided the property and manufactured home is the owner’s primary residence as of October 1. Proof of title (if 1994 or later model) and proof of sales tax payment must be provided at the time of assessment/registration. All manufactured homes must be registered or assessed within 30 calendar days of purchase.
Renewal of manufactured home registrations for those who do not own their manufactured home and land is October/November each year. There is a $10.00 penalty for late registration. Persons over 65 or permanently and totally disabled should request exemption information prior to registration/renewal.
Owners of five acres or more of farmland, pastureland or timberland used to produce agricultural products, livestock, or wood products may apply for a Current Use exemption. This exemption allows for property to be assessed at less than market value when used only for the purposes specified here. Any owner of eligible property must make a formal application to the Revenue Commission Office if he or she wishes to claim Current Use.
Current Use applications may be obtained from the Revenue Commission Office at any time of the year, but under the Alabama State law, they must be filed with the Revenue Commission Office no later than December 31 for application on the next tax year’s ad valorem taxes. After Current Use has been granted, the owner who made application for current use does not have to re-apply for subsequent years; however, if the property ownership is transferred or the name is changed by deed or will, the new owner reflected by such change must file a new application for Current Use. Otherwise, ad valorem taxes will be calculated based on fair market value rather than current use values.