(a) On and after October 1, 1978, with respect to ad valorem taxes levied by the state, and, unless otherwise provided, with respect to ad valorem taxes levied by a county, municipality, or other taxing authority other than the state, all taxable property shall be divided into the following classes and no other and shall be assessed for ad valorem tax purposes at the following ratios of assessed value to the fair and reasonable market value of such property, or, as may be provided by law, to the current use value of such property:
CLASS I. All property of utilities used in the business of such utilities, 30 percent.
CLASS II. All property not otherwise classified, 20 percent.
CLASS III. All agricultural, forest, and residential property, and historic buildings and sites, 10 percent.
CLASS IV. All private passenger automobiles and motor trucks of the type commonly known as "pickups" or "pickup trucks" owned and operated by an individual for personal or private use and not for hire, rent, or compensation, 15 percent.
(b) As used herein, the following terms shall have the following meanings, respectively, unless the context clearly indicates otherwise:
(1) AGRICULTURAL AND FOREST PROPERTY. All real property used for raising, harvesting, and selling crops or for the feeding, breeding, management, raising, sale of, or the production of livestock, including beef cattle, sheep, swine, horses, ponies, mules, poultry, fur-bearing animals, honeybees, and fish, or for dairying and the sale of dairy products, or for the growing and sale of timber and forest products, or any other agricultural or horticultural use or animal husbandry and any combination thereof.
(2) HISTORIC BUILDINGS AND SITES. Regardless of the use to which such property is put, all buildings or structures (i) determined eligible by the state historic preservation officer for listing on the National Register of Historic Places; or (ii) located in a registered historic district and certified by the United States Secretary of the Interior as being of historic significance to the district.
(3) PRIVATE PASSENGER AUTOMOBILES AND MOTOR TRUCKS OF THE TYPE COMMONLY KNOWN AS "PICKUPS" OR "PICKUP TRUCKS" OWNED AND OPERATED BY AN INDIVIDUAL FOR PERSONAL OR PRIVATE USE AND NOT FOR HIRE, RENT, OR COMPENSATION. All private passenger automobiles, as that term is defined in Sections 40-12-240, subdivision (17), and 40-12-241; and all motor trucks of the type commonly known as "pickups" or "pickup trucks," weighing not exceeding 8,000 pounds gross weight.
(4) PROPERTY NOT OTHERWISE CLASSIFIED. All real and personal property which does not fall within any one or more of Classes I, III, and IV.
(5) PROPERTY OF UTILITIES. All property assessed for taxation by the Department of Revenue pursuant to the provisions of Chapter 21 of this title; provided, that after September 30, 1979, and only to the extent required by Title III, §306 of Pub. L. 94-210 (the Railroad Revitalization and Regulatory Reform Act of 1976, codified as 49 U.S.C. §26c), "transportation property," as that term is defined in the aforesaid statute, as heretofore or hereafter amended, or in any subsequent statute of similar import, shall not be assessed as Class I property and customer-owned coin-operated telephone companies shall not be assessed as Class I property.
(6) RESIDENTIAL PROPERTY. a. Real property, used by the owner thereof exclusively as the owner's single-family dwelling. This includes an owner who resides on the property and remains in possession of the property after it is sold at a tax sale.
b. Residential property shall include single-family dwellings and the fully-developed underlying lot owned by a home builder holding a valid and current license from the Home Builders Licensure Board or who is otherwise authorized by the board to construct single-family homes until sold or used for a purpose other than as a single-family dwelling; provided that this classification shall not exceed a period of 24 months from the date the owner home builder applies for the classification as provided herein.
(c) The single-family dwelling and the fully-developed underlying lot as described in paragraph b. of subdivision (6) of subsection (b) may be reclassified as Class III, rather than Class II, as authorized by Act 2011-544 based on the property owner filing documentary evidence of the date construction begins or the date the lot is fully developed pursuant to rules promulgated by the Department of Revenue, which rules shall include what documents may be accepted to qualify as Class III. The property shall be reclassified as Class II property until approved documentation is properly filed with the tax assessing official pursuant to the rules of the department. The authorization for the property to be reclassified as residential property shall not exempt the property from the provisions of Section 40-7-25.3, which shall apply to all property seeking the reclassification as residential property authorized by Act 2011-544.
(d) The reclassification of property authorized by subsection (c) shall terminate when one of the following occurs:
(1) The classification has been in place for 24 months.
(2) The owner no longer holds a valid license or authorization from the Home Builders Licensure Board.
(3) The sale, transfer, or any other action or inaction resulting in the single-family dwelling or the fully-developed underlying lot no longer being held by the person, firm, or corporation first seeking the reclassification.
(e) Fully-developed lots that on September 1, 2011, are within a platted and recorded subdivision and fully comply with the subdivision regulations applying to the subdivision, classified as Class II property, and owned by the person or firm originally platting the subdivision or owned by a person or firm authorized or licensed by the Home Builders Licensure Board to construct single-family homes may be reclassified as Class III property for the two tax years immediately following September 1, 2011. Notwithstanding the foregoing, in order to qualify for the reclassification, the owner shall properly file with the tax assessing official documentation required pursuant to the rules of the department.
(f) Wherever any statute provides for, limits, or measures the power or authority of any county, municipality, or other taxing authority to levy taxes, borrow money, or incur indebtedness in relation to the assessment of property therein for state taxes or for state and county taxes, such provision shall mean as assessed for county or municipal taxes.
(g) The following property shall be exempted from ad valorem taxation: The real and personal property of the state, counties, and municipalities and real and personal property devoted exclusively to religious, education, or charitable purposes. The property of Masonic lodges, Knights of Columbus homes, and union halls shall be exempt when used exclusively for the purposes and business of such organizations. All property now exempt by law shall continue to be exempt from taxation until changed by law.
(h) The Department of Revenue shall have authority to promulgate rules and regulations for the uniform identification and assessment of manufactured homes.
(i) In the event an owner's single-family dwelling is destroyed or damaged to the extent that the dwelling is uninhabitable, the property shall retain its classification as residential property while the dwelling is being rebuilt or restored to an inhabitable state for a period of not to exceed 24 months from the date of the destruction or damage. If the destroyed or damaged dwelling is not rebuilt or restored to an inhabitable state as the owner's single-family dwelling within 24 months from the date of the destruction or damage or the property is converted at any time to a use other than as the owner's single-family dwelling, the property shall lose its classification as residential property.
The owner may request an extension not to exceed an additional 24 months upon submission of proof that the work necessary to rebuild or restore the destruction or damage could not be contracted or if contracted could not be completed within 24 months from the date of the destruction or damage.
(j) Property classified as residential property shall not lose its classification as residential property for a period of 24 months if the property is not used as the owner's single-family dwelling because the property is not inhabitable or is otherwise under repair after being damaged by a natural disaster such as a tornado or hurricane.
Last modified: May 3, 2021