The Appeals Process in North Carolina From the Board of Equalization and Review to the North Carolina Property Tax Commission
In a previous post, we explained that real and business personal property in North Carolina is typically taxed at fair market value. We've also written in greater detail about the three generally accepted valuation approaches used to determine fair market value: the cost approach; the income capitalization approach; and the sales comparison approach. But that substantive information won't do much good if an appeal suffers a procedural failure. In this post, we do our best to provide an overview of the appeals process in North Carolina, including the various dates and filings one should be aware of when navigating this system. As you will see, it is easy to make a misstep in this system.
The Board of Equalization and Review
The first required level of appeal is to a body known as a Board of Equalization and Review. Each is comprised of local citizens appointed by the respective Board of County Commissioners. A Boardof Equalization and Review must convene between the first Monday in April and the first Monday in May and must adjourn by December 1 in revaluation years and July 1 in non-revaluation years. The deadline for an appeal to the local Board of Equalization and Review is the adjournment date for that Board. This sounds simple enough, but not all Boards of Equalization and Review adjourn on the same date. Thus, the deadline for the first level of appeal differs from county to county, and from year to year. The only way to be certain is to phone your tax assessor's office and make the inquiry.
a. Notices in Revaluation Years
Remember that taxing jurisdictions do not revalue real property every year. A year in which a taxing jurisdiction revalues its real property is typically referred to as a revaluation year. Taxing jurisdictions send out notices of assessment notifying taxpayers of the assessed values of their properties in revaluation years. These notices of assessment are typically (but not always) mailed in February, giving taxpayers notice of their assessed values and an opportunity to appeal before the deadline for doing so runs.
Revaluation notices often include language that appears to require taxpayers who disagree with their assessments to file requests for informal review. Despite what the revaluation notices appear to require, a taxpayer can bypass a request for informal review and instead appeal directly to the local Board of Equalization and Review. That said, we typically advise taxpayers to take advantage of the informal review process before a formal appeal is filed. Once a request for informal review is made and the tax assessor's office has reached its conclusion, a notice of final decision will be sent to the taxpayer. This notice will set forth a deadline for filing a formal appeal the Board of Equalization and Review.
b. Notices in Non-revaluation Years
A common procedural failure we see is a failure to file a Board of Equalization and Review appeal before the adjournment date in non-revaluation years. Why? Because tax assessors are not required to send out a notice of assessment in non-revaluation years. So, the first reminder that taxpayers receive about their property value will be the bill, which may not arrive until after the deadline for appeal has come and gone. Thus, the only safe bet in a non-revaluation year is to request a Board of Equalization and Review appeal form very early in the year and to file it before April 1. Otherwise, the appeal deadline can come and go, and unknowing taxpayers will lose a year of potential tax savings.
The North Carolina Property Tax Commission
Once a hearing is held at the local Board of Equalization and Review, the taxpayer will receive a notice of decision. If the taxpayer disagrees with that decision, it has thirty days from the date on the notice (not the date the notice is received) to file a Form AV-14 - Notice of Appeal and Application for Hearing with the North Carolina Property Tax Commission. A copy must also be served on the taxing jurisdiction's assessor and attorney. Once the AV-14 is filed, the appeal to the Commission is perfected.
At the Commission level, the North Carolina Rules of Civil Procedure apply, which means discovery is permissible. Additionally, the parties must file an Order on Final Pre-Hearing Conference that provides all stipulated facts and proposed evidence. Six executed copies of the Order and each party's evidence must be provided to the Commission at least ten days before the hearing of the matter.
Once the hearing is conducted, the Commission will issue its decision. If either the taxpayer or the taxing jurisdiction disagrees, they have the right to appeal the decision to the North Carolina Court of Appeals.
Image Copyright Jonathan Wilkins. This work is licensed under the Creative Commons 2.0 Generic License.