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Taxing Topics - Georgia Department of Revenue

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					      GEORGIA DEPARTMENT
               OF REVENUE

                       LOCAL GOVERNMENT
                       SERVICES DIVISION


       Taxing Topics

For Educational Purposes Only:

The material within is intended to give the course participant a solid
understanding of general principles in the subject area. As such, the
material may not necessarily reflect the official procedures and policies
of the Georgia Department of Revenue or the Department’s official
interpretation of the laws of the State of Georgia. The application of
applicability to specific situations of the theories, techniques, and
approaches discussed herein must be determined on a case-by-case
basis.



                                                              May 2012
      Georgia Department of Revenue

       TAXING TOPICS
                       Dan Ray
           Rockdale County Tax Commissioner

                    Mitch Schrader
            Clarke County Tax Commissioner

            Ellen Mills and Cheryl Spraggins
                 Department of Revenue


                                               1




        Georgia Department of Revenue

Constitutional Officers
2012 Election Year
  • Tax Commissioner
    – tax receiver
    – tax collector
  • Clerk of the Superior Court
  • Judge of Probate Court
  • Sheriff
                                               2




                                                   1
          Georgia Department of Revenue

          Consolidation of Office
GA Constitution Article IX, Section I, Paragraph III.

• (c) The General Assembly may
  consolidate the offices of tax receiver and
  tax collector into the office of tax
  commissioner.

      All 159 counties are consolidated.
                                                      3




          Georgia Department of Revenue

      Constitutional Amendments
• Chatham County - Tax assessor, chief, vested with
  functions of tax receiver. Ga. L. 1964, p. 986. 3

• Dougherty County - Tax commissioner abolished,
  merger of board of tax assessors with county
              authorized Ga L 1974 p. 1654.
  departments authorized. Ga. L. 1974, p 1654

• Pike County - Tax returns to board of tax assessors.
  Ga. L. 1978, p. 2405.

                                                      4




                                                          2
             Georgia Department of Revenue

Tax Commissioner
Oaths of Office

   – Tax Receiver 48-5-101
   – Tax Collector 48-5-121
   – Public Officer 45-3-1
   – Loyalty 45-3-11, 45-3-12, and 45-3-13


                                                  5




             Georgia Department of Revenue

Tax Commissioners
      48-5-122
Bonds 48 5 122
• State:
   –   40% of state tax due up to $50,000
   –   Payable to Governor
   –   Certified by Probate Judge
   –   Copy submitted t R
       C                           Commissioner
                b itt d to Revenue C      i i


• County:
   – Up to $100,000
   – Filed with county governing authority
                                                  6




                                                      3
Georgia Department of Revenue




                                7




Georgia Department of Revenue




                                8




                                    4
           Georgia Department of Revenue

Tax Commissioner
Training Requirement
              48-5-126.1 (Tax Commissioner)
          48-5-128.1 and 48-5-212 (Chief Deputy)

• 40 hrs of Training
   – 20 prior to assuming office for first time
   – 20 during first year of office
• 15 hrs of annual update training
    Subject to removal from office without proper training   9




           Georgia Department of Revenue

Duties of Tax Collector (40-2-23)
Tag Agent and Sales Tax Agent for DOR

Tax collectors are designated as tag agents of the
  Revenue Commissioner for the purpose of
  vehicle titling and registration.

          re en e                 may
The state revenue commissioner ma also
  designate the tag agent as a sales tax agent for
  the purpose of collecting sales and use tax on
  casual sales of a motor vehicles.
                                                             10




                                                                  5
          Georgia Department of Revenue

Tax Commissioner
may contract with municipalities
                    48-5-359.1
• Contract shall specify amount to be paid to CGA.
  – TC has final approval of contract.

• TC allowed to contract for providing service and
             compensation.
  may accept compensation
  Recommended to re-new the contracts yearly
        or at each new term of office.
                                                 11




          Georgia Department of Revenue

Tax Commissioner
                 Ex Officio
may be appointed Ex-Officio Sheriffs
                 48-5-137
• Written Consent from the Sheriff
  – Recorded with Probate Judge
  – Compensation – $349.78/month
• Gives TC full power to bring property to
  tax sale on courthouse steps.
• TC may appoint Deputy Ex-Officio Sheriffs
                                                 12




                                                      6
             Georgia Department of Revenue

Tax Commissioner
authority to waive penalty or interest
                    48-5-242
• County Governing Authority may pass resolution
  delegating TC with authority to waive penalty
  and interest.
     – Authorization can be limited or complete

    Covenant Breaches are exempt from waiver of
                  penalty & interest
                                                               13




             Georgia Department of Revenue

Tax Commissioner
authority to issue refunds
                  48-5-303, 48-5-380
•   Taxpayer files a written request with CGA
•   CGA has one year to act on request
•   Taxpayer can bring claim to Superior Court
•   Once approved refunds must be p
           pp                         paid within 60
    days of decision
    CGA can delegate, by resolution, the authority to refund
      obvious clerical errors to appropriate departments in
                        local government
                                                               14




                                                                    7
           Georgia Department of Revenue

 Duties of Tax Receiver (48-5-103)
 • Receive returns in manner provided by law.
 • Receive returns at any time taxpayer applies.
 • May designate the Board of Assessors to receive
   tax returns.
 • Prepare Taxable and Exempt Digests.
 • Post notice showing office hours
 • Conform to rules of Revenue Commissioner
 • Perform all other duties the law requires.
                                                     15




           Georgia Department of Revenue

 Delegation to Board of Assessors
 48-5-299.1
• Upon designation by the tax receiver or tax
  commissioner pursuant to paragraph (5) of Code
  Section 48-5-103, it shall be the duty of the board of
  assessors to receive tax returns as provided under
  paragraph (4) of Code Section 48-5-103 or to perform
    ll duties f tax    i        tax       i i      l ti
  all d ti of t receivers or t commissioners relating
  to the receiving of applications for homestead
  exemptions from ad valorem tax, or both, pursuant to
  such designation.
                                                     16




                                                           8
           Georgia Department of Revenue



•




                                                17




           Georgia Department of Revenue

Tax Receiver
              g
Returns and Digest Submission

April 11          Tax Receiver turns over
                  returns to Assessors.
July 1            Assessors correct returns
                  and turns over to TC.
August 1          Tax Receiver submits digest
                  to Revenue Commissioner.
                                                18




                                                     9
           Georgia Department of Revenue

Duties of Tax Collector (48-5-127)

•   Diligently Collect Taxes & Disburse Promptly
•   Issue Executions
•   Have insolvent lists allowed in proper manner.
•   Post & maintain notice showing office hours
•   Conform to rules of Revenue Commissioner
•   Keep Voters Book
•   Perform all other duties that the law requires.

                                                          19




           Georgia Department of Revenue

Tax Collector
Billing
Required public information on Tax Bill….
    – Statement regarding gradual reduction in state ad
      valorem tax. (48-5-8)
    – Information regarding homestead and
      appeals. (48-5-56)
    – Statement regarding rollback for Local option
      sales tax.
                                                          20




                                                               10
            Georgia Department of Revenue

 Tax Collector
 Billing
Tax Bill Due Date….
  – Taxpayer must be given 60 days from date of
    postmark to pay. (48-5-148)
  – Due date is December 20 – unless different
    d t set b resolution of CGA
    date t by       l ti   f CGA.
• Temporary Bills issued:
   – When property is under appeal; or
   – When ordered by Superior Court.                        21




            Georgia Department of Revenue

 Tax Collector
 Collection
Interest on Late Payments
    – 1% of Tax per month after Dec 20th. (48-2-40)

Penalties become part of the tax.(48-2-42)
  Types of Penalties
   – Failure to Return: 10% set by BOARD OF ASSESSORS
   – Failure to Pay: 10% after 90 days generally
   – Returned/Bad Check: 1% of amt
   – Breach of Covenant: varies per covenant set by Assessors
   – Timber: 50% of tax due
                                                            22




                                                                 11
           Georgia Department of Revenue

Tax Collector
Disbursements of Tax
                   48-5-141 thru 143
• Disbursements to County:
  – Population > 30,000 – Weekly
  – Population < 30,000 – Every 2 Weeks
• Disbursement to State – Monthly
• Disbursement to Cities – Monthly
                                                                23




           Georgia Department of Revenue

Tax Collector                                Important Notice
Executions
As soon as the deadline for the payment of tax has arrived,
  the tax commissioner must NOTIFY the taxpayer that
  unless taxes are paid, an execution will be issued.

The EXECUTION may then be issued at any time after 30
  days has lapsed since issuing the execution notice to the
  taxpayer

   Execution means a written order issued to a sheriff,
  directing him to carry out the process for the collection of
                      ad valorem taxes.                      24




                                                                     12
           Georgia Department of Revenue

Tax Collector
Executions – Special Circumstance
Special Circumstances apply when the real property has
  been sold after January 1st of the taxable year.

No execution may be issued against a person who is not
  the owner of the property on the day that the taxes
  become delinquent – if that person provided proof within
  90 days from the due date, that the liability for the taxes
  has been assigned to the new owner by written
  agreement or contract.
                                                             25




           Georgia Department of Revenue

Tax Collector
Executions – Special Circumstance

In addition, the execution may not be issued against the
   new owner unless such new owner has been sent a
   notice of the delinquent tax and intent to issue a tax
   execution if not paid within 30 days of the date of the
     ti
   notice.




                                                             26




                                                                  13
           Georgia Department of Revenue

Tax Collector
Executions – Special Circumstance
Whenever technologically feasible, the tax commissioner
 shall mail tax bills to new owners as shown on records of
 the BOARD OF ASSESSORS.

A new purchaser of property is not required to pay
  i t    t        lt    til    d     ft th t
  interest or penalty until 60 days after the tax
  commissioner has forwarded a tax bill.

 This provision only applies to the tax bill applicable to the
          year in which the property was purchased
                                                             27




           Georgia Department of Revenue

Tax Collector
                       48-5-19
Transfer of Executions 48 5 19
Whenever a person pays an execution
 issued for state, county, or municipal taxes
 or special assessments, the officer whose
       s e o ce t e e ecut o        ay
 duty is to enforce the execution may
 transfer the execution to the party paying
 the full value of the execution.

                                                             28




                                                                  14
              Georgia Department of Revenue

 Tax Collector
                        48-5-19
 Transfer of Executions 48 5 19

The person who purchases the execution:
   – Shall have the same rights to enforce the execution as TC.
   – Shall have the same priority of payment
   – Shall enter the execution on general execution docket of superior
     court within 30 days.




                                                                     29




              Georgia Department of Revenue

 Tax Collector
                        48-5-19
 Transfer of Executions 48 5 19

   It is unlawful (misdemeanor) for the following
       officials to pay a tax execution in order to obtain a
       transfer:
       –   County tax commissioners;
       –   M b        f    t b d f tax
           Members of county boards of t assessors;
       –   Members of county boards of equalization; and
       –   County tax appraisers.



                                                                     30




                                                                          15
           Georgia Department of Revenue

Tax Collector
                       48-5-19
Transfer of Executions 48 5 19

A transferee does not have the right to advertise and sell
   property on courthouse steps.

Such right remains solely with the sheriff.




                                                             31




           Georgia Department of Revenue

Tax Collector
                     48 5 28
Executions Satisfied 48-5-28

An entry of satisfaction shall be made on the execution
  docket as soon as reasonably possible after a tax
  execution has been fully satisfied.




                                                             32




                                                                  16
               Georgia Department of Revenue

Ex-Officio Sheriff
Levy and Tax Sale - Advertisement
When a levy is made upon real or personal property, the property shall be
  advertised and sold.

The defendant shall be given ten days' written notice of such sale by registered
   or certified mail or statutory overnight delivery.

Advertisements for sales under tax executions may describe the property by
   tax parcel identification number and current street address, together with a
   reference to the recording information for any deed conveying title to such
   property, without the necessity of using a full and complete description of
   the property.
                                                                              33




               Georgia Department of Revenue

                    Priority of Tax Liens
Li    for taxes ranked as follows:
Liens f t          k d    f ll
         State
         County
         School
         Municipality
Fi t Priority and S
First P i it            d
                d Secured
Lien attaches January 1
         48-5-10
         Decatur Co Bldg. & Loan v. Thigpen
                                                                              34




                                                                                   17
           Georgia Department of Revenue

Ex-Officio Sheriff
Levy and Tax Sale – Funds Collected
Once the tax commissioner places the execution in the
  hands of the Sheriff; the Sheriff is authorized to collect
  and shall proceed promptly to enforce by levy and sale.

Once the collection is made or tax sale occurs the Sheriff
  shall make prompt settlements with the tax
  commissioner.


                                                               35




           Georgia Department of Revenue

Ex-Officio Sheriff
Tax Sale – Purchase by Taxpayer

One who is obligated to pay a tax on
 property cannot strengthen his title by
 purchasing the property at a tax sale.

Each such purchase shall be treated as
 payment for the tax due.
                                                               36




                                                                    18
              Georgia Department of Revenue

Ex-Officio Sheriff
Tax Sale – County Can Bid on Property
The governing authority may purchase REAL PROPERTY offered for
  sale but only when other bids do not cover the amount of the tax
  executions and costs. The governing authority may not bid more for
  the property than the amount of taxes and costs.

                                              county.
The Taxpayer may REDEEM the property from the county

The governing authority is not required to pay the proportionate part of
  the taxes due the state, school, or other jurisdictions until the real
  property is redeemed or resold.

                                                                       37




              Georgia Department of Revenue

Ex-Officio Sheriff
Tax Sale – County Can Bid on Property
The governing authority may purchase PERSONAL PROPERTY
  offered for sale but only when other bids do not cover the amount of
  the tax executions and costs. The governing authority may not bid
  more for the property than the amount of taxes and costs.

                                   FINAL.
The Sale of Personal Property is FINAL
No redemption, a bill-of-sale is issued to the county.

The governing authority is not required to pay the proportionate part of
  the taxes due the state, school, or other jurisdictions until the real
  property is resold.
                                                                       38




                                                                            19
               Georgia Department of Revenue

Ex-Officio Sheriff
Tax Sale – TC may not Bid on Property
The tax commissioner and his employees may not buy real property
  sold at tax sale.

Except that the tax commissioner or employee may purchase property
  sold at public auction for delinquent taxes when the tax
  commissioner or employee has an ownership interest in the property
  and had an ownership interest in the property at the time the taxes
  became delinquent.


                                                                                 39




               Georgia Department of Revenue

Tax Sale – Excess Funds

If there are excess funds after paying taxes and expenses of a sale , the sheriff
     shall give written notice, within 30 days, to the record owner of the property
     at the time of the tax sale and to the record owner of each security deed
     affecting the property and to all other parties having any claim in such
     property at the time of the tax sale.

The notice shall contain a description of the land sold, the date sold, the name
   and address of the tax sale purchaser, the total sale price, and the amount
   of excess funds.

The notice shall state that the excess funds are available for distribution to the
   owner or owners as their interests appear in the order of priority in which
   their interests exist.
                                                                                 40




                                                                                      20
              Georgia Department of Revenue

Tax Sale – Excess Funds

The sheriff may file an interpleader action in superior court so that such
  excess funds may be distributed to various interested persons,
  including the owner.

The cost of litigation of such an interpleader action, including
                        y
  reasonable attorney's fees, shall be p  paid from the excess funds
  upon order of the court.




                                                                          41




              Georgia Department of Revenue

Tax Sale – Excess Funds to DOR
After five years has lapsed from the tax sale date, the sheriff holding
   excess funds shall pay over to the Department of Revenue, any
   excess unclaimed funds for which no action is pending in Superior
   Court.

Once excess funds are placed in the possession of DOR, only a court
  order from an interpleader action filed in the county, by the claimant
          funds                                                  funds
  for the funds, shall serve as justification for release of the funds.




                                                                          42




                                                                               21
Georgia Department of Revenue

                  UNCLAIMED PROPERTY
                          includes
                 Excess Funds from Tax Sales

                Five Year Dormancy Period (has
               to reach the fifth year by June 30th)

                  Tax Commissioner or Sheriff
               remits funds along with information
                     on all potential owners

                  Release of Funds requires an
                ‘Interpleader’ filed with Superior
                              Court


                                                 43




Georgia Department of Revenue

                Unclaimed Property Facts
                 Georgia started receiving
                 unclaimed funds in 1981.
                DOR averages $97 million a
                 year in total collections.

                 In 2010 we received $119
                           property
                million in property. However
                     only $64 million had
                      associated owner
                         information.

                                                 44




                                                       22
              Georgia Department of Revenue

Tax Deed Holder
Redemption

Whenever real property is sold, the ‘defendant in fi. fa.’ (taxpayer) or
  any person having any interest in or lien upon such property may
  redeem the property from the sale by the payment of the redemption
  p
  price :

        (1) At any time within 12 months from the date of the sale; and

        (2) At any time after the sale until the right to redeem is
        foreclosed.
                                                                      45




              Georgia Department of Revenue

Tax Deed Holder
Redemption
The redemption price shall be the total of:

        Amount paid at the tax sale (shown on the tax deed);
        Plus Additional taxes paid by the purchaser after the sale;
        Plus Special assessments;
        Plus 20% of the amount for the first year;
        Plus 10% for each year thereafter.




                                                                      46




                                                                           23
              Georgia Department of Revenue

Tax Deed Holder
Redemption
When property is redeemed, the effect of the redemption shall be to
  convey the tax deed interest back to the ‘defendant in fi. fa.’
  (Taxpayer), subject to all liens existing at the time of the tax sale.

If the redemption has been made by a creditor of the taxpayer, the
    amount expended by the creditor shall constitute a first lien on the
    property.

When property is redeemed, the Tax Deed Holder (or purchaser at tax
  sale) shall issue a quitclaim deed to the defendant in fi. fa.,
  (taxpayer) .
                                                                           47




              Georgia Department of Revenue

Tax Deed Holder
Foreclose the Right of Redemption
After 12 months from the date of a tax sale, the Tax Deed Holder may
   foreclose (forever bar) the right to redeem the property by:

   (1) Issuing a notice of the foreclosure to:
         The ‘defendant in fi fa (taxpayer);
         The          t f the         t
         Th occupant of th property; and   d
         All persons having any interest in, or lien on the property;

   (2) Publishing a notice in the newspaper once a week for four
   consecutive weeks .
                                                                           48




                                                                                24
              Georgia Department of Revenue

Tax Deed Holder
Ripening of Tax Deed
A tax deed executed prior to July 1, 1989, shall ripen after seven years
   from the date of execution of that deed.

A tax deed executed on or after July 1, 1989, shall ripen after a period
   of four years from the execution of that deed.

A tax deed executed on or after July 1, 1996, shall ripen after a period
   of four years from the recordation of that deed.

A tax deed which has ripened shall convey an absolute fee simple title
                       to the grantee in the deed.
                                                                           49




              Georgia Department of Revenue

Tax Collector
Managing Insolvents
Insolvent lists shall be allowed only by the county governing authority.

Before the county governing authority allows the insolvent list, the
  sheriff shall take an oath that he has made every effort in his power
  to collect and that he believes the taxpayers has no property from
  which the tax can be collected.

When insolvent lists are allowed, they shall be entered on the minutes,
  and the county governing authority shall furnish the tax collector
  certified copies of the lists.
                                                                           50




                                                                                25
        Georgia Department of Revenue




                                             51




        Georgia Department of Revenue

             Errors and Releases
  O.C.G.A. 48 5 154 ” the
• O C G A 48-5-154…” th county     t
  governing authority shall have the
  jurisdiction and power to correct all errors
  in the digests, to order abatement or
  cancellation of taxes erroneously
  assessed,
  assessed and to make other adjustments
  in the digests of a similar nature and to
  reflect the same in the account as
  stated….”
                                             52




                                                  26
         Georgia Department of Revenue

              Errors and Releases


• O.C.G.A. 48-5-241 (a) In all cases where
  a person has been overtaxed or claims for
  any reason that taxes should be credited
  o e u ded, t e county governing
  or refunded, the cou ty go e       g
  authority may hear and determine such
  application to the extent of the interest of
  the county in the matter.
                                                 53




         Georgia Department of Revenue

              Errors and Releases
  O.C.G.A. 48 5 380 (a) Each        t h ll f d
• O C G A 48-5-380 ( ) E h county shall refund
  to taxpayers any and all taxes…which are
  determined to have been erroneously or illegally
  assessed …
• (b)…The governing authority shall approve or
  disapprove
  disapprove…
• …where there is no obvious error, the approval
  or disapproval of claims may not be delegated
  by the governing authority…
                                                 54




                                                      27
                  Georgia Department of Revenue

         Correction of Mistakes in Digest
48‐5‐303. Correction of mistakes in digest; notification of correction.
48 5 303 Correction of mistakes in digest; notification of correction

(a)  The county board of tax assessors shall have authority to correct factual errors in the tax 
     digest when discovered within three years and when such corrections are of benefit to the 
     taxpayer. Such corrections, after approval of the county board of tax assessors, shall be 
     communicated to the taxpayer and notice shall be provided to the tax commissioner. 

(b)  If a tax receiver or tax commissioner makes a mistake in the digest which is not corrected by 
     the county board of tax assessors or county board of equalization, the commissioner, with 
     the sanction of the Governor, shall correct the mistake by making the necessary entries in 
     the digest furnished the commissioner. The commissioner shall notify the county governing 
     authority and the tax collector of the county from which the digest comes of the mistake and 
     correction. 




                                                                                                55




                  Georgia Department of Revenue

Department of Revenue
2012 Bulletins and Memos
1.   Conservation Use Application policy
2.   Gradual phase out of state ¼ mill
3.   Assessor Certification
4.   Forest Land Fair Market Value Index
5.   Bulk Order Continuous Feed forms
6.   Digest Submission Changes
7.   Announcement Concerning Disabled Veteran Exemption
8.   Conservation Use Assessment ‘catch-up’


                                                                                                56




                                                                                                      28
                         Georgia Department of Revenue




                                                                                                                             57




                         Georgia Department of Revenue

     48-5-8. Manner and time of making state levy;
        notice on taxpayer's ad valorem tax bill.
1.   beginning on or after January 1, 2011, and prior to January 1, 2012, the levy shall be 0.25 mills.
2.   beginning on or after January 1, 2012, and prior to January 1, 2013, the levy shall be 0.2 mills.
3.   beginning on or after January 1, 2013, and prior to January 1, 2014, the levy shall be 0.15 mills.
4.   beginning on or after January 1, 2014, and prior to January 1, 2015, the levy shall be 0.1 mills.
5.   beginning on or after January 1, 2015, and prior to January 1, 2016, the levy shall be 0.05 mills.
6.   beginning on or after January 1, 2016, there shall be no levy for state taxation.



Tax, penalty, and interest liabilities and refund eligibility for prior taxable years shall not be affected by this subsection
     a d shall continue to be governed by the p o s o s o this Code sec o as it e s ed immediately p o to May 12,
     and s a co      ue o      go e ed          e provisions of s            section      existed      ed a e y prior o ay ,
     2010.

Each fiscal authority issuing an ad valorem property tax bill shall place a prominent notice on each taxpayer's ad valorem
    tax bill in substantially the following form:

"This gradual reduction and elimination of the state property tax and the reduction in your tax bill this year is
    the result of property tax relief passed by the Governor and the House of Representatives and the Georgia
    State Senate."

                                                                                                                             58




                                                                                                                                  29
                         Georgia Department of Revenue

                    Gradual Reduction?
           What if the 2012 tax bill is going UP?
O.C.G.A. § 1‐3‐1(b) provides that in interpreting statutes the “ordinary signification shall be applied to all words” except for words 
     of art or words associated with a particular trade or subject matter. 

O.C.G.A. § 1‐3‐1 (c) provides that “a substantial compliance with any statutory requirement especially on the part of public 
     officers, shall be deemed and held sufficient, and no proceeding shall be declared void for want of such compliance, unless 
     expressly so provided by law.”

Because O.C.G.A. § 48‐5‐8 only requires that the language on the property tax bill is “substantially” in the required form the 
     “ordinary signification” would imply there can be some variation, so long as legislative intent is still followed.

The main point of the required phrase appears to be that the state portion of the tax bill is going down and that the reason is due 
     to the action of the Governor and the Legislature .  The legislative intent seems to speak more to a reduction of the state 
     portion of the ad valorem tax more so than it does to a reduction of the tax overall. Because of that, it seems that the 
     required language could be changed in order to take out the portion about “the reduction in your tax bill this year”, when 
     that language would not make sense if the overall tax bill is going up.

Summary:  The exact language to be used may be left up to the discretion of the local authorities  keeping in mind the spirit and 
    intent of the law and message intended to be conveyed to the taxpayer.
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                         Georgia Department of Revenue




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                                     33
             Georgia Department of Revenue

2012 Legislative
Update
HB48    Level 2 Freeport
HB386   Tax Reform
HB397   Open Records
HB634   Population Bill (Butts, Cobb, Dekalb, and Fulton)
HB729   IRC
HB851   Distribution of RETT and Intangible
HB916   Conservation Use
SB284   Land Banks


                                                                     67




             Georgia Department of Revenue

             HB48 – Level 2 Freeport
• Current Freeport is now called LEVEL 1
   – Available to Manufacturers and Distributors
      Category 1 – raw materials & goods in process
      Category 2 – finished goods held by manufacturer
      Category 3 – finished goods held by distributor
            p
• New Freeport will be called LEVEL 2
   – Available to Retailers (must be approved by voters)
      Includes inventory not otherwise qualified for LEVEL 1

Issues: Rental equipment currently appraised and depreciated as non-
    inventory, may be included in Level 2 Freeport. Supplies currently
         not included in Level 1 Freeport, may qualify for Level 2.  68




                                                                          34
                Georgia Department of Revenue

HB386 – Tax Reform (motor vehicle)

40-5-441.1
  Motor vehicles subject to 48-5B-1 (Motor Vehicle Title Ad
  Valorem Tax) shall be classed as a separate class of
  tangible property for ad valorem purpose.

Motor vehicles subject to ‘Title Ad Valorem Tax’ will not be
       subject to sales tax or annual ad valorem tax.
However, the $18 Title Application Fee will still apply and
   annual tag renewal will still apply. Effective 3/1/2013
                                                                   69




                Georgia Department of Revenue

             HB386 – Fair Market Value

• Fair Market Value means same as 48-5-442 (average of
   wholesale and retail)
    – Revenue Commissioner to provide a “MV Valuation Manual”
    – When vehicle value is not found in Manual:
       • New vehicle: bill-of-sale minus rebates and before allowance
         for trade-in value.
       • Used vehicle: Use greater of bill-of-sale or market guide.
• Trade-in Value means value stated in bill-of-sale for a
  vehicle which has been traded-in to the dealer when
  purchasing another vehicle from the dealer.
                                                                   70




                                                                        35
            Georgia Department of Revenue

            HB386 – Taxable Value

               Fair Market Value of Vehicle
            - Trade-in Value (when applicable)
                     = Taxable Value

           Taxable Value * Tax Rate = Tax Due



                                                                     71




            Georgia Department of Revenue

HB386 –Title Tax Rate

 2013 – 6.5% x FMV minus trade-in value

 2014 – 6.75% x FMV minus trade-in value

 2015 – 7% x FMV minus trade-in value

  In Tax Years 2015, 2018 and 2022, the Revenue Commissioner
         shall determine the state target collection amount
         and may adjust the combined state and local rate
 to no greater than a combined rate of 9%, to become effective the
                        following January 1st.                       72




                                                                          36
            Georgia Department of Revenue

HB386 – Tax Rate Exceptions (salvage)


• Salvage Vehicles:
   – A person acquiring a salvaged vehicle shall be subject to a Title
     Tax rate of 1% of Fair Market Value.
   – The total tax amount is distributed to the State of Georgia.




                                                                     73




            Georgia Department of Revenue

HB386 – Tax Rate Exceptions (donated)


• Vehicles donated to Non-Profits (501(c)3) when titled in
  name of non-profit:
   – Donation must be for purpose of being transferred to another
     person.
     Subject t         t      l        hi l         f F i Market
   – S bj t to same rate as salvage vehicles (1% of Fair M k t
     Value)




                                                                     74




                                                                          37
           Georgia Department of Revenue

HB386 – Tax Rate Exceptions (death)
• Death of owner who previously paid regular ad valorem:
     Heir or beneficiary (immediate family member) may
     continue to pay Regular Ad Valorem or may elect in
     writing to pay Title Tax at prevailing tax rate.

• Death of owner who previously paid Title Tax:
     Heir or beneficiary (immediate family member) is
     subject to pay Title Tax at a state rate of .25% of
     FMV and a county rate of .25% of FMV.

                                                            75




           Georgia Department of Revenue

HB386 – Tax Rate Exceptions (family)
• Transfer of vehicle, on which regular ad valorem was
  previously paid, to an immediate family member:
      Immediate family member may continue to pay
      regular ad valorem or may elect to pay Title Tax at
      prevailing rate

• Transfer of vehicle, on which Title Tax was previously
  paid, to an immediate family member:
      Immediate family member is subject to pay Title Tax
      at a state rate of .25% of FMV plus county rate of
      .25% of FMV.                                       76




                                                                 38
           Georgia Department of Revenue

HB386 – Tax Rate Exceptions (Rental Company)
• Vehicles owned by a Motor Vehicle Rental Company
  may be taxed at a state rate of .75% of the FMV plus a
  local rate of .75% of the FMV, only when the average
  sales and use tax charged on each vehicle was at least
  $400 in the prior year.
• Entity will have to obtain a certification from the Revenue
  Commissioner.



                                                           77




           Georgia Department of Revenue

HB386 – Due Date Exception
(Moving into GA)

• Persons moving into GA and who are required to
  obtain a GA title for a vehicle which was formerly
  titled in another state:
   – Subject to pay Title Tax at a state and local
      rate of 50% of amount otherwise due.
   – Remainder 50% shall be payable within 12
      months.
                                                           78




                                                                39
            Georgia Department of Revenue

HB386 – Exemption


• Motor Vehicle Ad Valorem Title Tax does not apply to
  titles issued for the following reasons:
   – Corrected Titles
   – Replacement Titles
   – GA Titles reissued to the same owner.




                                                                    79




            Georgia Department of Revenue

HB386 – Exemption

• State and local Title Tax does not apply to titles issued
  on the following vehicles:

   – Vehicles owned or leased by state, county, school, municipality,
     or other government entity.
     48-5-478 (di bl d t
   – 48 5 478 (disabled veteran) )
   – 48-5-478.1 (former prisoner of war)
   – 48-5-478.2 (veterans awarded Purple Heart)
   – 48-5-478.3 (veterans awarded Medal of Honor)

                                                                    80




                                                                         40
            Georgia Department of Revenue

HB386 – Opt in provision

• An owner who purchased a vehicle in GA on or after
  January 1, 2012 and prior to March 1, 2013 may opt-in to
  the Title Tax at any time prior to January 1, 2014.
   – Must pay difference of sales tax and ad valorem paid during year
     of purchase as compared to the 6.5% title tax which would have
     otherwise been due.




                                                                   81




            Georgia Department of Revenue

HB386 – Appeal of FMV

• The Fair Market Value of any motor vehicle subject to
  Motor Vehicle Ad Valorem Title Tax shall be appealable
  in the same manner as authorized for motor vehicles
  subject to ad valorem tax.



   DOR considering motor vehicle appeal regulations to
    facilitate efficient administration of increased motor
     vehicle appeals to the county board of assessors.             82




                                                                        41
            Georgia Department of Revenue

HB386 – MV Ad Valorem Title Tax
Distribution




                                                           83




            Georgia Department of Revenue

HB386 – Tax Reform (income tax)
Applicability to Homestead
• The personal exemption for married filing joint status for
  income tax is increased to $7400.
   – $3700 each when filing ‘married filing separate’
• Disabled persons and persons over age 65 receive a
  $65,000 ti       t income exclusion.
  $65 000 retirement i         l i

    This will effect the net GA income for income-based
                     homestead exemptions.
                                                           84




                                                                42
             Georgia Department of Revenue

HB386 – Tax Reform (income tax)
Applicability to Appraisal of
Conservation Easement Property
• Certain income tax credits are granted to persons who
  donate qualified property for conservation purposes.
   –   Protect water quality
   –   Protect wildlife
   –   Protect outdoor recreation
   –   Protect forestry
   –   Protect cultural sites

                                                          85




             Georgia Department of Revenue

             HB397 – Open Meetings

• With regard to open meetings the code
  revision applies to every county
  department, agency, board (board of tax
  assesso s), bu eau, o ce (ta
  assessors), bureau, office (tax
  commissioner), commissioner, authority
  or similar body

                                                          86




                                                               43
         Georgia Department of Revenue

         HB397 – Open Records
• With regard to Open Records this code
  revision applies to every county
  department, agency, board, bureau, office,
  commissioner, authority or similar body –
  AND – any association or corporation that
  has a membership composed of counties,
  municipalities, or school districts. (ACCG,
  GMA)
                                                    87




         Georgia Department of Revenue

           HB397 – Government
• Failing or refusing to comply with Open
  Meetings and Open Records provision
  may result in the following penalties:
  – Criminal: fine for first offence up to $1000
  – Civil Penalty: fine for first offence up to $1000

    Fines up to $2500 for each offence may be
          imposed for additional violations.
                                                    88




                                                         44
           Georgia Department of Revenue

            HB634 –Population Bill
• Amends population provision in 48-5-24 so
  that Dekalb County may continue
  receiving tax payments in two installments
  and charging a 5% penalty when
  delinquent.
  delinquent

Without revision: Per 2010 census, Cobb County residents
 would have qualified for this version of installment billing.
                                                                89




           Georgia Department of Revenue

            HB634 –Population Bill
• Amends population provision in 48-5-24 so
  that Fulton County may continue charge
  certain interest rates according to set
  schedule.


   Without revision: Per 2010 census, Gwinnett County
   residents would have qualified for this billing provision.
                                                                90




                                                                     45
         Georgia Department of Revenue

          HB634 –Population Bill

• Amends population provision in 48-5-24 so
  that Cobb County may continue collect tax
  on an installment schedule and charge
  certain interest rates.
  ce ta     te est ates



                                                91




         Georgia Department of Revenue

          HB634 –Population Bill

• Amends population provision in 48-5-24 so
  that Butts County may continue to allow
  homestead exemption on certain Georgia
  Power leased lake lot p ope t es
    o e eased a e ot properties.
Without revision: Per 2010 census, Berrien County
       residents would have qualified for this
                homestead provision.
                                                92




                                                     46
        Georgia Department of Revenue

             HB729 – IRC Bill
  Amends OCGA 48 34 so that the
• A      d         48-5-345       h h
  Revenue Commissioner may assess a
  penalty for a deficient tax digest only equal
  to the difference between the amount the
  state levy would have produced if the
            y             p
  digest had the proper assessment level.
   Adjusts the penalty as the state levy is
    gradually reduced per OCGA 48-5-8         93




        Georgia Department of Revenue




                                              94




                                                   47
           Georgia Department of Revenue

      HB851 – Intangible and RETT
• Removes a provision for 4% commission
  (instead of 6%) on collection of intangible
  recording tax and real estate transfer tax
  in Cobb, Dekalb, Fulton, and Gwinnet
  counties
  counties.

Now Cobb, Dekalb, Fulton, and Gwinnett Clerks of Court may charge
                   6% commission for collection.
                                                                95




           Georgia Department of Revenue

         HB916 – Conservation Use
  Amends C
• A                   ti Use Assessment:
        d Conservation U A               t
   – The residence and its underlying land (up to 2
     acres) must be excluded from Covenant
   – Previously adopted county resolutions for CUVA
     minimums may be void
   – Properties under 10 acres must provide written
     evidence
      • An IRS Schedule E, F, or form 4835 shall be
        sufficient proof
                                                                96




                                                                     48
        Georgia Department of Revenue

       HB916 – Conservation Use
  Amends C
• A                 i Use Assessment i
         d Conservation U A          in
  the following manner;
  – The residence and its underlying land (up to 2
    acres) must be excluded from Covenant.
              y    p          y
  – Previously adopted county resolutions for
    CUVA minimums are void.
  – Properties under 10 acres must provide
    written evidence and an IRS Schedule E, F, or
    form 4835 shall be sufficient proof.         97




        Georgia Department of Revenue

       HB916 – Conservation Use

• Amends Conservation Use Assessment:
  – Adds a definition of contiguous property
  – Allows up to 50 acres of subsequently
    acquired land to enter an existing covenant.




                                                   98




                                                        49
         Georgia Department of Revenue

HB916 - CUVA




                                                     99




         Georgia Department of Revenue

SB284 – Georgia Land Bank Act



• Newly created land bank authorities must
  be governed by Georgia Land Bank Act:
• Purpose:
  – Enable communities to turn abandoned and
    tax delinquent properties into productive use.
                                                 100




                                                          50
        Georgia Department of Revenue

   SB284 – Georgia Land Bank Act


• Creation:
  – Any county or city may elect to create a land
    bank by the adoption of a local law, ordinance
    or resolution.



                                                101




        Georgia Department of Revenue

   SB284 – Georgia Land Bank Act

• Power:
  – A land bank shall have the power to
    purchase, lease, hold, and dispose of real or
    personal property of every kind and character.
  – A land bank does not have the power of
    eminent domain.

                                                102




                                                      51
         Georgia Department of Revenue

   SB284 – Georgia Land Bank Act
• Exemption:
  – The real property of a land bank and its
    income and operations are exempt from ALL
    TAXATION by the state and by any of its
    political subdivisions, including but not limited
    p                     ,         g
    to real property held by a land bank as lessor
    pursuant to long-term lease contracts with
    community land trusts.
                                                    103




         Georgia Department of Revenue

   SB284 – Georgia Land Bank Act
• Funding:
  – Up to 75% of ad valorem tax collected on real
    property conveyed by a land bank shall be
    remitted to the land bank for five years.
               g
     • Excluding state and school tax
     • Excluding tax allocation districts.
     • Excluding bond levies.


                                                    104




                                                          52
         Georgia Department of Revenue

    SB284 – Georgia Land Bank Act
• Delinquent tax:
  – Whenever real property that is acquired by a
    land bank is encumbered with certain tax
    liens, the land bank may, by resolution,
    discharge and extinguish any and all such
             g          g       y
    liens and claims.



                                                  105




         Georgia Department of Revenue

    SB284 – Georgia Land Bank Act
• Delinquent tax:
  – To the extent that a land bank receives
    payments attributable to liens for real property
    tax on property acquired by the land bank, the
    land bank shall remit the full amount to the tax
    commissioner.



                                                  106




                                                        53
        Georgia Department of Revenue

   SB284 – Georgia Land Bank Act


• Executions:
  – A tax commissioner may assign, transfer, or
    sell to a land bank any ad valorem tax
    executions issued against any property within
    the land bank’s jurisdiction.


                                                107




        Georgia Department of Revenue

   SB284 – Georgia Land Bank Act
  Non-judicial     l
• N j di i l tax sale:
  – In a non-judicial tax sale where the tax
    commissioner or land bank is the holder of the
    execution, the land bank may bid in an
    amount equal to the total amount of all tax
    liens plus i t
    li                 t      lt   d     t
           l interest, penalty, and costs.



                                                108




                                                      54
 Georgia Department of Revenue

Forest Land Assistance Grant




                                        109




 Georgia Department of Revenue

           Tax Bills

 Bills will be based on forestland
       conservation use value:

   Fair Market Value Assessment (“J”)
             – SJ Exemption
        = Taxable Assessed Value
                * Mill Rate
                  = Tax
                                        110




                                              55
Georgia Department of Revenue

Without FLPA Exemption




                                111




Georgia Department of Revenue

 With FLPA Exemption




                                112




                                      56
               Georgia Department of Revenue

                       Reimbursement

48-5A-3(c)(1)(A) Immediately following the
  actual preparation of ad valorem property
  tax bills, each county fiscal authority shall
  notify the department of the amount of the
  reduction pursuant to the implementation
  of Article VII, Section I, Paragraph III(f) of
  the Constitution
                                                                               113




               Georgia Department of Revenue

      The FLPA Reimbursement Grant
                                                             county…
If the forest land conservation use property is located in a county where
     forest land conservation use value causes an ad valorem tax REVENUE
     REDUCTION of 3 percent or less due to the implementation of this
     subparagraph, …, the assistance grants to the county… shall be in an
     amount equal to 50 percent of the amount of such reduction.

If the forest land conservation use property is located in a county, … where
     forest land conservation use value causes an ad valorem tax REVENUE
     REDUCTION of more than 3 percent due to the implementation of this
     subparagraph, …, the assistance grants to the county … shall be as
     follows:

    For the first 3 percent of such reduction amount, in an amount equal to 50
      percent of the amount …
    For the remainder of such reduction amount, in an amount equal to 100
      percent of the amount …

                                                                               114




                                                                                     57
         Georgia Department of Revenue

Reimbursement only applies to certain levies:

48-5A-1……. means the net ad valorem tax
  millage rate, after deducting applicable
  rollbacks…., including any millage levied for
  those special districts reported on the 2004 ad
  valorem tax digest certified to and received by
  the commissioner on or before December 31,
  2004, but not including any millage levied for
  purposes of bonded indebtedness ….
                                                    115




         Georgia Department of Revenue

            PT-32.1A Worksheet




                                                    116




                                                          58
      Georgia Department of Revenue




                                                   117




      Georgia Department of Revenue

 PT-77 must be accompanied by:
1. PT-32.1A
     FLPA Revenue Reduction Calculation
     Worksheets

2. PT-35 & PT-38
     Millage Rate Certification form

3. PT-77A
     Adjustments from prior years, if applicable
                                                   118




                                                         59
 Georgia Department of Revenue

DOR sends assistance grant to
 County Tax Commissioner




                                 119




 Georgia Department of Revenue




                                 120




                                       60
Georgia Department of Revenue




                                121




Georgia Department of Revenue




                                122




                                      61
Georgia Department of Revenue

       FLPA Audits




                                123




Georgia Department of Revenue

  Ad Valorem Tax Digest
         History




                                124




                                      62
                        Georgia Department of Revenue

                         Net State Digest Values
                    Residential
                    R id ti l                                                   Commercial
                                                                                C      i l
200,000,000,000                                         100,000,000,000
190,000,000,000                                          80,000,000,000
180,000,000,000
                                                         60,000,000,000
170,000,000,000
                                                         40,000,000,000
160,000,000,000
150,000,000,000                                          20,000,000,000
140,000,000,000                                                     -
                   2005 2006 2007 2008 2009 2010 2011                          2005 2006 2007 2008 2009 2010 2011



                    Mobile Home                                                   Industrial
 1,600,000,000                                           20,000,000,000
 1,400,000,000                                           19,500,000,000
 1,200,000,000                                           19,000,000,000
 1,000,000,000
                                                         18,500,000,000
   800,000,000
                                                         18,000,000,000
   600,000,000
   400,000,000                                           17,500,000,000
   200,000,000                                           17,000,000,000
           -                                             16,500,000,000
                   2005 2006 2007 2008 2009 2010 2011                          2005 2006 2007 2008 2009 2010 2011
                                                                                                                          125




                        Georgia Department of Revenue

                         Net State Digest Values
                    Agricultural                                                        Timber
10,000,000,000
                                                         700,000,000
 8,000,000,000                                           600,000,000
                                                         500,000,000
 6,000,000,000
                                                         400,000,000
 4,000,000,000                                           300,000,000
                                                         200,000,000
 2,000,000,000
                                                         100,000,000
          -                                                      -
                   2005 2006 2007 2008 2009 2010 2011                     2005    2006    2007    2008    2009    2010    2011


                  Conservation use
                  C       ti                                                    Forest Land
 3,000,000,000
                                                        600000000
 2,500,000,000
                                                        500000000
 2,000,000,000                                          400000000
 1,500,000,000                                          300000000
 1,000,000,000                                          200000000
   500,000,000                                          100000000
           -                                                    0
                   2005 2006 2007 2008 2009 2010 2011                   2005     2006    2007    2008    2009    2010    2011
                                                                                                                          126




                                                                                                                                 63
                        Georgia Department of Revenue

                                            Total Digest Net Value
                 400,000,000,000
                 350,000,000,000
                 300,000,000,000
                 300 000 000 000
                 250,000,000,000
                 200,000,000,000
                 150,000,000,000
                 100,000,000,000
                  50,000,000,000
                              -
                                     2005      2006      2007      2008          2009          2010      2011




                                             Average Overall Millage
                           28.5
                              28
                           27.5
                              27
                           26.5
                              26
                                    2005     2006     2007      2008      2009          2010      2011
                                                                                                                        127




                        Georgia Department of Revenue

                                  Ad Valorem Taxation
                                   Avg Net Digest x A O
                                   A N t Di                ll Millage
                                                t Avg Overall Mill
10,000,000,000



 9,500,000,000



 9,000,000,000



 8,500,000,000



 8,000,000,000



 7,500,000,000



 7,000,000,000
                       2005           2006            2007             2008              2009             2010   2011


                                                                                                                        128




                                                                                                                              64

				
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