23 Oct What is the law in regards to property taxation?

CONST718
PART II. PROPERTY TAXATION

§18. Ad Valorem Taxes

Section 18.(A) Assessments. Property subject to ad valorem taxation shall be listed on the assessment rolls at its assessed valuation, which, except as provided in Paragraphs (C), (F), and (G), shall be a percentage of its fair market value. The percentage of fair market value shall be uniform throughout the state upon the same class of property.

(B) Classification. The classifications of property subject to ad valorem taxation and the percentage of fair market value applicable to each classification for the purpose of determining assessed valuation are as follows:

Classifications/Percentages

1. Land
10%

2. Improvements for residential purposes
10%

3. Electric cooperative properties, excluding land
15%

4. Public service properties; excluding land
25%

5. Other property
15%

The legislature may enact laws defining electric cooperative properties and public service properties.

(C) Use Value. Bonafide agricultural, horticultural, marsh, and timberlands, as defined by general law, shall be assessed for tax purposes at ten percent of use value rather than fair market value. The legislature may provide by law similarly for buildings of historic architectural importance.

(D) Valuation. Each assessor shall determine the fair market value of all property subject to taxation within his respective parish or district except public service properties, which shall be valued at fair market value by the Louisiana Tax Commission or its successor. Each assessor shall determine the use-value of property which is to be so assessed under the provisions of Paragraph

(C). Fair market value and use value of the property shall be determined in accordance with criteria that shall be established by law and which shall apply uniformly throughout the state.

(E) Review. The correctness of assessments by the assessor shall be subject to review first by the parish governing authority, then by the Louisiana Tax Commission or its successor, and finally by the courts, all in accordance with procedures established by law.

(F) Reappraisal. (I) All property subject to taxation shall be reappraised and valued in accordance with this Section, at intervals of not more than four years.

(2)(a) In the year of implementation of a reappraisal as required in Subparagraph (1) of this Paragraph, solely for purposes of determining the ad valorem tax imposed on the residential property subject to the homestead exemption as provided in Section 20 of this Article, if the assessed value of immovable property increases by an amount which is greater than fifty percent of the property’s  assessed value in the previous year, the collector shall phase-in the additional tax liability resulting from the increase in the property’s assessed value over a four-year period as follows:

(i) For purposes of calculating the ad valorem taxes on the property in the first levy following reappraisal, the collector shall use the property’s assessed value from the previous year, which shall be called the base amount as used in this Subparagraph, and shall increase the portion of the assessed value of the property used to calculate ad valorem taxes by adding an amount which is equal to one-fourth of the amount of the increase in the property’s assessed value as a result of the reappraisal to the base amount. This resulting amount shall constitute the property’s taxable value and shall be used solely for purposes of calculating ad valorem taxes for that taxable year.

(ii) For purposes of calculating the ad valorem taxes on the property in the second levy following reappraisal, the collector shall increase the portion of the assessed value of the property used to calculate ad valorem taxes by adding an amount which is equal to one-half of the amount of the increase in the property’s assessed value as a result of the reappraisal to the base amount. This resulting amount shall constitute the property’s taxable value and shall be used solely for purposes of calculating ad valorem taxes for that taxable year. (iii) For purposes of calculating the ad valorem taxes on the property in the third levy following reappraisal, the collector shall increase the portion of the assessed value of the property used to calculate ad valorem taxes by adding an amount which is equal to three-quarters of the amount of the increase in the property’s assessed value as a result of the reappraisal to the base amount. This resulting amount shall constitute the property’s taxable value and shall be used solely for purposes of calculating ad valorem taxes for that taxable year.

(iv) In the fourth levy following reappraisal, the collector shall calculate ad valorem taxes based on the property’s full assessed value.

(b) The provisions of this Subparagraph providing for a phase-in of additional ad valorem tax liability following reappraisal shall cease to apply upon the transfer or conveyance of ownership of the property. Following a transfer or conveyance, the collector shall calculate ad valorem taxes based on the property’s full assessed value.

(c) Property subject to the provisions of this Subparagraph shall not be subject to a reappraisal by an assessor until after the four-year phase-in of the amount of the increase in the property’s assessed value is complete.

(d) Notwithstanding any provision of this constitution to the contrary, the increase in assessed valuation of property phased-in under this Subparagraph shall be included as taxable property for purposes of any subsequent reappraisals and valuation for millage adjustment purposes under Article VII, Section 23(B) of this constitution. The decrease in the total amount of ad valorem tax collected by a taxing authority as a result of this phase-in of assessed valuation shall be absorbed by the taxing authority and shall not create any additional tax liability for other taxpayers in the taxing district as a result of any subsequent reappraisal and valuation or millage adjustment.

Implementation of this phase-in of increase in assessed valuation authorized in this Subparagraph shall neither trigger nor because for a reappraisal of property or an adjustment of millages pursuant to the provisions of Article VII, Section 23(B) of this constitution.

(e) The provisions of this Subparagraph shall not apply to the extent the increase was attributable to construction on or improvements to the property.

(G) Special Assessment Level.

(l)(a)(i) The assessment of residential property receiving the homestead exemption which is owned and occupied by any of the following and who meet all of the other requirements of this Section shall not be increased above the total assessment of that property for the first year that the owner qualifies for and receives the special assessment level, provided that such person or persons remain qualified for and receive the special assessment level:

(aa) People who are sixty-five years of age or older.
(bb) People who have a service-connected disability rating of fifty percent or more by the United States Department of Veterans Affairs.

(cc) Members of the armed forces of the United States or the Louisiana National Guard who owned and last occupied such property who are killed in action, or who are missing in action or are a prisoner of war for a period exceeding ninety days.

( dd) Any person or persons permanently totally disabled as determined by a final non-appealable judgment of a court or as certified by a state or federal administrative agency charged with the responsibility for making determinations regarding disability.

(ii) Any person or persons shall be prohibited from receiving the special assessment as provided in this Section if such person’s or persons’ adjusted gross income, as reported in the federal tax return for the year prior to the application for the special assessment, exceeds fifty thousand dollars. For persons applying for the special assessment whose filing status is married filing separately, the adjusted gross income for purposes of this Section shall be determined by combining the adjusted gross income on both federal tax returns. Beginning for the tax year 2001, and for each tax year thereafter, the fifty thousand dollar limit shall be adjusted annually by the Consumer Price Index as reported by the United States Government.

(iii) An eligible owner or the owner’s spouse or another legally qualified representative shall apply for the special assessment level by filing a signed application establishing that the owner qualifies for the special assessment level with the assessor of the parish or, in the parish of Orleans, the assessor of the district where the property is located.

(iv) An owner who is below the age of sixty-five and who has applied for and received the special assessment level may qualify for and receive the special assessment level in the subsequent year by certifying to the assessor of the parish, or in the parish of Orleans, the assessor of the district where the property is located, that such person or persons’ adjusted gross income in the prior tax year satisfied the income requirement of this Section. The provisions of this Subsubparagraph (a)(iv) shall not apply to an owner who has qualified for and received the special assessment level for persons sixty-five years of age or older or to such owner’s surviving spouse as described in Subsubparagraph ( a)(i) of this Subparagraph.

(b) Any millage rate applied to the special assessment level shall not be subject to a limitation.

(2) Provided such owner is qualified for and receives the special assessment level, the special assessment level shall remain on the property as long as:

(a)(i) The owner who is sixty-five years of age or older, or that owner’s surviving spouse who is fifty-five years of age or older or who has minor children, remains the owner of the property.

(ii) The owner who has a service-connected disability of fifty percent or more, or that owner’s surviving spouse who is forty-five years of age or older or who has minor children, remains the owner of the property.

(iii) The spouse of the owner who is killed in action remains the owner of the property.

(iv) The first day of the tax year following the tax year in which an owner who was missing in action or was a prisoner of war for a period exceeding ninety days is no longer missing in action or a prisoner of war.

(v) Even if the ownership interest of any surviving spouse or spouse of an owner who is missing in action as provided for in this Subparagraph is an interest in usufruct.

(b) The value of the property does not increase more than twenty-five percent because of construction or reconstruction.

(3) A new or subsequent owner of the property may claim a special assessment level when eligible under this Section. The new owner is not necessarily entitled to the same special assessment level on the property as when that property was owned by the previous owner.

( 4)(a) The special assessment level on the property that is sold shall automatically expire on the last day of December in the year prior to the year that the property is sold. The property shall be immediately revalued at fair market value by the assessor and shall be assessed by the assessor on the assessment rolls in the year it was sold at the assessment level provided for in Article VII, Section 18 of the Constitution of Louisiana

(b) This new assessment level shall remain in effect until changed as provided by this Section or this Constitution.

(5)(a) Any owner entitled to the special assessment level set forth in this Paragraph who is unable to occupy the homestead on or before December thirty-first of a future calendar year due to damage or destruction of the homestead caused by a disaster or emergency declared by the governor shall be entitled to keep the special assessment level of the homestead prior to its damage or destruction on the repaired or rebuilt homestead provided the repaired or rebuilt homestead is reoccupied by the owner within five years from December thirty-first of the year following the disaster. The assessed value of the land and buildings on which the homestead was located prior to its damage shall not be increased above its assessed value immediately prior to the damage or destruction described in this Subsubparagraph. If the property owner receives a homestead exemption on another homestead during the same five-year period, the damaged or destroyed property shall not be entitled to keep the special assessment level, and the land and buildings shall be assessed in that year at the percentage of fair market value set forth in this constitution. In addition, the owner shall also maintain the homestead exemption set forth in Article VII, Section 20 (A)(l 0) to qualify for the special assessment level in this Subsubparagraph. (b) Any owner entitled to the special assessment level set forth in Subsubparagraph (a) of this Subparagraph who is unable to reoccupy his homestead within five years from December thirty-first of the year following the disaster shall be eligible for an extension of the special assessment level on the homestead for a period not to exceed two years. A homeowner shall be eligible for this extension only if the homeowner’s damage claim is filed and pending in a formal appeal process with any federal, state, or local government agency or program offering grants or assistance for repairing or rebuilding damaged or destroyed homes as a result of the disaster, or if a homeowner has a damage claim filed and pending against the insurer of the property. The homeowner shall apply for this extension of the special assessment level with the assessor of the parish in which the homestead is located. The assessor shall require the homeowner to provide official documentation from the government agency or program evidencing the homeowner’s participation in the formal appeal process or official documentation evidencing the homeowner has a damage claim filed and pending against the insurer of the damaged property, as provided by law.

( c) After expiration of the extension authorized in Subsubparagraph (b) of this subparagraph, an assessor shall have the authority to grant on a case-by-case basis up to three additional one-year extensions of the special assessment level as prescribed by law.

(6)(a) A trust shall be eligible for the special assessment level as provided by law.

(b) If a trust would have been eligible for the special assessment level pursuant to this Subparagraph prior to the most recent reappraisal, the total assessment of the property held in trust shall be the assessed value on the last appraisal before the reappraisal. Amended by Acts 1979, No. 799, §1, approved Oct. 27, 1979, eff. Dec. I, 1979; Acts 1997, No. 1491, §1, approved Oct. 3, 1998, eff. Jan. 1, 2000; Acts 2002, No. 87, §1, approved Nov. 5, 2002, eff. Dec. 11, 2002; Acts 2005, No. 511, §1, approved Nov. 7, 2006, eff. Jan. I, 2007; Acts 2005, 1st Ex. Sess., No. 70, §1, approved Sept. 30, 2006, eff. Oct. 31, 2006; Acts 2010, No. 1050, §1, approved Nov. 2, 2010, eff. Jan. 1, 2011; Acts 2018, No. 718 and 721, approved Nov. 6, 2018, eff. Dec. 12, 2018.