Committee Report

May 4, 2023

H. 3072

Introduced by Reps. Hewitt, McCravy, Burns, Pace, Pope, J. Moore and Caskey

 

S. Printed 05/04/23--H.

Read the first time January 10, 2023

 

________

 

The committee on House Ways and Means

To who was referred a Bill (H. 3072) to amend the South Carolina Code of Laws by amending Section 12-43-220, relating to assessment ratios, so as to provide that under certain circumstances, property, etc., respectfully

Report:

That they have duly and carefully considered the same, and recommend that the same do pass with amendment:

 

Amend the bill, as and if amended, by adding an appropriately numbered SECTION to read:

SECTION X. Article 3, Chapter 37, Title 12 of the S.C. Code is amended by adding:

 

    Section 12-37-460. Notwithstanding any other provision of law, when an owner of real property dies, the property shall continue to receive any property tax exemption it was receiving at the time of death until the decedent's estate is closed, upon the recording of a deed or deed of distribution out of the estate, or after December thirty-first of the year following the date of death, whichever occurs first. This section does not apply if the property becomes ineligible for the exemption for a reason other than the death.

Renumber sections to conform.

Amend title to conform.

 

BRUCE BANNISTER for Committee.

 

statement of estimated fiscal impact

Explanation of Fiscal Impact

 

Local Revenue

This bill adds a new subitem to Section 12-43-220(c) stating that when a property owner dies, property receiving the owner-occupied special assessment ratio shall continue to receive the assessment ratio until the deceased's estate is closed, upon recording of a deed or deed of distribution from the estate, or after December 31, of the year following the date of death, whichever occurs first. This provision only applies for property that is not rented and applies to property tax years beginning after 2022. Based upon an estimated average owner-occupied property value of $203,721 and a statewide millage rate of 352.5 for tax year 2023, this provision would on average reduce local property tax by approximately $1,436 per incidence for the reduced assessment ratio and $1,407 for property tax exemptions for school operations on owner-occupied property, or a total of $2,843 annually per incidence.

 

We do not anticipate that most probate cases will extend long enough to prompt a county to change the assessment ratio on a deceased person's property from four percent to six percent, but data are not available to determine the number of incidences in which this occurs. Additionally, we are also unsure as to how a county would determine that the property owner is deceased and remove the special assessment ratio until the property ownership is transferred by recording of a deed. Due to the limited information available and difficulty in determining the prevalence of this situation occurring, the impact on local property taxes statewide is undetermined.

 

 

Frank A. Rainwater, Executive Director

Revenue and Fiscal Affairs Office

 

________

 

 

 

 

 

 

 

 

 

A bill

 

to amend the South Carolina Code of Laws by amending Section 12-43-220, relating to assessment ratios, so as to PROVIDE THAt under certain circumstances, property RECEIVING THE FOUR PERCENT ASSESSMENT RATIO shall continue at four percent when the owner DIEs.

 

Be it enacted by the General Assembly of the State of South Carolina:

 

SECTION 1.  Section 12-43-220(c) of the S.C. Code is amended by adding a subitem to read:

 

    (9) Notwithstanding any other provision of law, when an owner receiving the special assessment rate pursuant to this item (c) dies, the property shall continue to receive the special assessment rate until the decedent's estate is closed, upon the recording of a deed or deed of distribution out of the estate, or after December thirty-first of the year following the date of death, whichever occurs first. This subitem does not apply if the property is rented for more than seventy-two days in or following the calendar year of the decedent's death or if a change of use occurs.

 

SECTION 2.  This act takes effect upon approval by the Governor and applies to property tax years beginning after 2022.

----XX----