The bill would postpone tax increases that kick in when a property changes ownership. It’s not exactly what the South Carolina Realtors Association hoped for, but it’s a fairly significant step in what many state realtors believe could help spark home sales and the state economy in South Carolina.
The bill would give up to five years of tax savings for most property buyers.
The big issue is point-of-sale reassessments, which changes a property’s taxable value – increasing it to approximately the purchase price – whenever there’s a change in ownership. The bill would delay the increase in value until the next county-wide reassessment of all property values, which in South Carolina typically happens every five years.
The realtors association hoped to have point-of-sale reassessments eliminated entirely, which won’t quite happen. The House bill originally called for that step but the feeling was it had little chance of passing and was replaced with the current plan. The realtors association said they would continue to push for the elimination of point-of-sale reassessments.
As it is, the new legislation could cost local governments and schools about $40 million, which means it’s not a particularly popular move for the local municipalities and school boards.
Point-of-sale reassessments began in South Carolina in 2007 when the state changed the way property is taxed, giving large breaks for homeowners and limiting assessment increases so long as the property stayed in the same hands. The idea was to protect property owners from large tax increases as assessments can rise no more than 15 percent every five years. However realtors say it made people more hesitant to buy and sell homes and businesses weary of buying for fear they would be at a competitive disadvantage with a smaller business with lower taxes.
South Carolina has been here before. In each of the past two years, the state House passed similar legislation only to see it killed in the Senate. This year, though, the realtors association was willing to concede more in order to take a step closer to its ultimate goal.
The next steps with the bill will be having it assigned by the Senate to a committee, though it likely wouldn’t be taken up until January.
Clearly, the world of property taxes and filing appeals is a tricky one, and ever changing. If you have any questions about your property or how your state assesses properties, or you think your may be overpaying on your property taxes, log on to www.valueappeal.com or give us a call at 877-829-1277 and let us help you take control and see if you might be able to save on your tax bill.