SB 396

Under current law, a person may file a claim with the taxation district where

the property is located to recover unlawful property taxes. A person who files a claim

must allege at least one of the following as the basis for the claim:

1. The taxation district made a clerical error regarding the description of the

property or the computation of the tax.

2. The assessment included real property improvements that did not exist on

the date of the assessment.

3. The property is exempt from taxation.

4. The property is not located in the taxation district.

5. The taxation district made a double assessment of the property.

If the taxation district allows the claim, it pays the claimant the amount of

property taxes collected and may include interest at the rate of 0.8 percent a month,

computed from the date on which the person filed the claim.

Under current law, a person may also file a claim with the taxation district

where the property is located alleging that the assessment of the person's property

is excessive. If the taxation district allows the claim, it pays the claimant the amount

of the excess and may include interest at the average annual discount rate

determined by the last auction of six-month U.S. treasury bills before the filing of

the claim per day for the period between the time when the tax was due and the date

that the claim was paid. This rate is generally lower than the rate of interest paid

on claims to recover unlawful property taxes.

This bill changes the interest rate for payments made on a claim to recover

unlawful taxes so that it is the same as the payments made on a claim of excessive

assessment.

Under current law, when a taxation district rescinds or refunds property taxes

paid by a taxpayer in the district, the district may submit a form to the Department

of Revenue to collect from each underlying taxing jurisdiction its proportionate share

of the rescinded or refunded amount. However, that amount does not include

interest paid by the taxation district on claims for excessive assessment or to recover

unlawful property taxes. This bill allows the taxation district to collect from each

underlying taxing jurisdiction its proportionate share of the interest paid on claims

for excessive assessment or to recover unlawful property taxes.