How to Appeal a County’s Tax Assessment in North Carolina
By Jason W. Wenzel
December 29, 2024
North Carolina’s power to tax its citizens is set forth in Article V of the North Carolina Constitution. Such taxation must be exercised in a just and equitable manner.
Tax on citizens’ property is the primary source of local government revenue. Every county in North Carolina must reappraise all of its real property at least every eight (8) years, on a statutorily prescribed schedule. G.S. 105-286(a). Counties may choose a more frequent reassessment. For example, Wake County’s most recent reappraisal was effective January 1, 2024. Johnston County has transitioned from an octennial cycle in 2019 to a sexennial cycle effective January 1, 2025, and will shift to a quadrennial cycle January 1, 2029.
A stated reason by county’s for more frequent periodic revaluations is to adjust property tax values to market values, however there is more gray than black in any mass appraisal system.
When conducting a reevaluation, each county must adopt a “schedule of values” (G.S. 105-317), however all property must be valued at its true value, statutorily defined as the price it would change hands between a willing buyer and willing seller when neither are under any compulsion to buy or sell. G.S. 105-286.
While a private appraiser should give equal weight to each of the common appraisal methodologies (comparable sales; income; and cost approaches to value), due to the sheer number of properties that must be valued in a short period of time, counties generally rely most heavily on estimated comparable sales by neighborhood.
Each property owner is mailed a tax listing form in early January of each year, and is required to return such form to the tax office prior to January 31st or face late listing penalties. See G.S. 105-307 and 105-308. A taxpayer should pay special attention to listing forms in reappraisal years, as there is a short window of time to appeal.
There are three (3) appeal stages (informal; Board of Equalization and Review; and Property Tax Commission) that a taxpayer may consider before resorting to the court system.
- Informal Appeal. Once the tax listing forms are sent, most county’s open an informal appeal window. There is no cost for a taxpayer to contact the tax office and submit relevant information regarding the property for the tax office’s consideration. Considering the volume of valuations a county must perform, this process is encouraged to address obvious issues (former residence burned and property now vacant) and even more specific issues (such as a rent roll for income producing rental property). Note that the informal appeal window is usually quite short (often only a manner of months).
- Board of Equalization and Review (BER). If a taxpayer either fails to participate in the informal review or is dissatisfied with the informal review result, the taxpayer can appeal the tax assessor’s valuation to the county’s BER. Most county tax offices will post its BER appeal forms on its website. By statute, the BER must no earlier than the first Monday in April and no later than the first Monday in May. G.S. 105-322 et seq. While more structured than an informal appeal (which can include subpoenas and examination of witnesses under oath), a BER hearing is generally less formal and more concise than a normal court proceeding.
- Property Tax Commission (PTC). A taxpayer may appeal the BER’s determination within thirty (30) days of mailing of the written decision to the PTC, a state-wide body consisting of five (5) appointed members (three from the Governor and two from the General Assembly) that sits in Raleigh. A PTC hearing is de novo, meaning the PTC is not bound by evidence presented at the BER level and hears the matter anew, however the PTC is not required to consider evidence of a factor affecting value unless the county assessor was made aware of it during the tax year in question, it was stated to the BER on appeal, or it is made a part of the application for appeal to the PTC.
Appeals of a PTC ruling are to the North Carolina Court of Appeals, and then to the North Carolina Supreme Court.
Regardless of the status of a property tax appeal, the underlying property tax remains due by the end of the calendar year (usually with a grace period into the first couple days of January of the following year, to allow time for checks to be mailed and processed), and a taxpayer should pay the assessed property taxes under protest. For example, a PTC hearing may not occur for more than a year from the BER hearing. If the tax appeal is ultimately successful, a tax refund (plus interest) is rebated to the taxpayer.
Each property is unique and therefore its true value nebulous. A taxpayer will be stuck with a reassessed value until the next reevaluation, meaning a high valuation will continue for multiple future tax years. If you have questions regarding a property tax assessment or its appeal, contact the real estate attorneys at Narron Wenzel, P.A. to discuss your options.