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What Homeowners Need To Know About Columbus-Muscogee County's Property Tax Freeze

Price Paid For Property A recent editorial in the Columbus Ledger-Enquirer expressed one person's concerns about the Muscogee County property tax freeze. Judging by the letters to the editor that followed, his concerns are shared by similarly affected homeowners. If you're considering buying a home or have recently bought a home in Columbus-Muscogee County, here are some important facts you need to know about the property tax freeze. History of the Property Tax Freeze In an effort to combat increasing property taxes, the residents of Muscogee County voted to approve a property tax freeze in 1983. Since then, the repeal of the property tax freeze has twice been put to a public vote. Each time, the measure was struck down by voters and the property tax freeze remains in effect. The freeze has also been challenged in Georgia's court system on the grounds that it is unfair to renters, homeowners new to the area, and homeowners who aren't eligible for a homestead exemption. A trial court agreed and struck down the law in 2002. The Georgia Supreme Court overturned the lower court's ruling in 2003. As a result, the only way the tax freeze will be repealed is if the residents of Muscogee County vote to end it. How the Property Tax Freeze Works Home values generally increase substantially over several years. However, the tax freeze provides that the market value of a home can't be changed unless the property is sold or transferred to another owner, the home is renovated, or a valuation error is being corrected. The home's value is automatically frozen when an owner files for a homestead exemption. Homeowners are only responsible for paying local taxes once the freeze is in place. Rental and commercial properties are exempt from the provisions of this law so renters aren't directly impacted by the freeze. However, since the rental property owner cannot benefit from the freeze, renters may pay the higher assessed property taxes through their monthly rent. Impact of the Property Tax Freeze Although no one may have anticipated this at the time, the property tax freeze has been controversial. A study of the annual value from 1983 to 1997 of residential properties in Muscogee County was conducted by Georgia State University researchers in 2001. The study found "that one of the effects of the adoption of acquisition value assessment has been to create a sizeable assessment inequality among homeowners." In other words, homeowners who have been in the same home for many years are likely paying very little in property taxes. However, the homeowner who recently bought the house next door will be assessed taxes at the now higher market value for a similar home. What Can You Do About It? - Research the home values and assessed property taxes of any home you're considering purchasing on the Columbus Consolidated Government's website. Be sure to note the purchase date, property value, assessed value, and taxes paid for neighboring homes. If no homes have been purchased in the area for a while, you will likely be paying much higher taxes than your neighbors since your taxes will be based on the current price paid for the home. - Consider buying a home in a neighboring county instead. Harris County and Phenix City, Alabama have a more conventional property tax assessment system which means more equitable assessment of property taxes. - If you have already bought a house in Muscogee County, stay current on the property values in your neighborhood. If you own rental property, don't qualify for a homestead exemption and your property's market value has decreased, filing annual property tax returns with the county tax assessor's office can help lessen your property tax burden. - Let the mayor and other elected officials know how you feel about the tax freeze. If necessary, organize a group of similarly affected residents and start a letter writing campaign to try to get the issue back on the ballot. Sources: Alston & Bird, LLP. (2002). Georgia Court Strikes Down Residential Property Tax Value Freeze. Washington, D.C.: Alston & Bird, LLP. Sjoquist, D. L., & Pandey, L. (2001). An Analysis of Acquisition Value Property Tax Assessment for Homesteaded Property. Public Budgeting and Finance, 1-17. Walck, P. E. (1999, 06 15). Columbus's Tax Freeze: Boon or Bust? Retrieved May 18, 2011, from Savannah Now: By Tracey McGoughy - I am an aspiring writer and editor with an interest in a variety of topics. I am especially passionate about natural skin care, fitness, personal finance, crime and social justice, and traveling inexpensivel...