New Year, New Taxes: How the New Year Could Affect North Carolina Property Taxes

The beginning of the year is often filled with thoughts of the future, personal resolutions you want to keep, and the hope of spring being just around the corner. The last thing you want to think about is property taxes. However, in many North Carolina counties, the New Year may also bring with it higher property taxes.

In North Carolina, real property taxes are based on the value of real property on January 1st of that year. Theoretically, that means that the value of your home or real property as it stands on January 1st is the value on which you will have to pay taxes for that year. North Carolina Statute defines the “true value” of real property as meaning “the price estimated in terms of money at which the property would change hands between a willing and financially able buyer and a willing seller.” Essentially, the intent of the statute is that the amount of what you pay in property taxes is to be calculated based on the amount that you would actually receive if you were to sell your home on the specific date of January 1st.

Additionally, North Carolina Counties are required to reappraise all real property as of January 1st every eight years. Practically, this means that your property taxes are based on the value of your home as of January 1st of the most recent reappraisal year. Once the reappraisal year comes around, the real property taxes could go up significantly if the “true value” of your home has increased in the previous eight years.

So, what does this mean for you, the homeowner? The answer to that question depends on whether your home is a new construction and whether your county is reappraising real property this year. If you buy a brand new house after January 1st, your closing attorney most likely used the sale price of the property to estimate what your taxes are going to be. This means that once the county initially appraises your home, your property taxes could go up if your house is appraised for more, or it could go down if the appraisal is less than what you paid for your home. Also, if you purchased a home that was built after January 1st of the same year that you bought it, then your property taxes are more than likely based on the value of the unimproved land that your home was on January 1st.

If you live in a county that is scheduled to do reappraisals, then there is a good chance that your property taxes will go up in 2019. Property tax bills are usually issued in August or September, so if your county is scheduled to have a reappraisal in 2019, then the property tax bill that comes out in the fall of 2019 will reflect the reappraised value, rather than the value that your taxes were based on for the last 8 years. In 2019, according to the North Carolina Department of Revenue, the counties that are scheduled for reappraisals include: Ashe, Brunswick, Burke, Carteret, Catawba, Durham, Gaston, Graham, Henderson, Hartford, Iredell, Johnston, Lee, Lincoln, Macon, McDowell, Mecklenburg, Moore, Pender, Randolph, Rockingham, Rowan, Rutherford, Sampson, Scotland, Wayne and Wilkes.  

If you have questions about your North Carolina property taxes, contact an attorney at Black, Slaughter & Black, P.A., to assist you further.