Property taxes photo

Every four to six years, the state assesses property sales in each county in an effort to remain consistent with current market values.

For Tennessee property owners, Feb. 28 is the last day to pay property taxes without accruing penalties or interest.

Where some property owners may have seen an increase in their tax bill, others may have experienced little change or even a slight decrease in their payment, which is largely determined by the certified tax rate that is set after a county has gone through reappraisal by the state.

The state conducts property reappraisals in each county every four to six years in an effort to remain consistent with the current market value. Trousdale County went through reappraisal in 2022, and Macon County properties will be reappraised in 2023.

“The big adjustment in tax collection comes from reassessment,” said Trousdale County Property Assessor Mike Potts. “Trousdale County is on a six-year rotation. Every six years, the state comes in and assesses property sales all across the county. By that, they readjust the property values to try and get as close to even with current market value. We saw a huge increase in market value over the last six to 10 years. That is the majority of where the tax changes have come. The certified rate is based on our entire book of properties.”

Macon County Property Assessor Rick Shoulders added, “The only thing that will increase property taxes is an increase in the tax rate. Every county in the state does a reappraisal once every four, five, or six years. That is only when the values can go up. They don’t go up just because everything is selling like crazy. They can’t go up until there is a reappraisal of the whole county. If the county needs more money, they raise the tax rate. That is what makes everyone’s taxes go up.”

But while some areas of a county may see very little growth, other areas may experience significant development, thus increasing property values during reappraisal.

“During reappraisal, if there is one area in the county that is selling a lot higher than the rest, and their values increase more on one side of the county than the other, then their taxes are going to increase a little bit more,” said Shoulders. “But then to offset it, the taxes in another part of the county may go down a little bit. But it’s very minute.”

Potts added, “Someone’s taxes may have gone up while someone else’s didn’t go up at all or may have even decreased because they aren’t in an area that experienced as much growth. (For example), in the (Highway) 231 South corridor (of Trousdale County), the land value went from $7,500 an acre to over $20,000 an acre. So, if you have more than five or six acres, it gets pretty extreme when you see the price change, not counting that home values themselves have also gone up.”

As a result of the growing population in many areas of the state, the need for more publicly-funded resources has increased.

“If taxes have increased, it is only because the county needs more money to operate, and they increased the tax rate,” said Shoulders. “We have had three tax increases in the 26 years that I have been in office. We have built two schools and a justice center/jail combination. When a county has to build those, then, you have to have additional money. That’s really why a tax increase happens.”

Potts added, “Any time we talk about building jails or schools, property taxes are the number one thing to be raised.”

However, according to Shoulders, when property values increase, the tax rate decreases.

“When reappraisal happens, the value of everybody’s property goes up, and the tax rate goes down to match, so there will not be an increase,” said Shoulders. “The tax rate is the same for everybody.

“Macon County needs $14 million to operate. So, the tax rate is set—ours is $2.40. The $2.40 tax rate generates the $14 million for the county to operate on. Now comes along the reappraisal, and let’s just say, (for instance), that everybody’s property value goes up. When all of those appraisals go up, the county still only needs $14 million to operate on, so the tax rate comes down whatever percentage is needed to generate $14 million. So, instead of the tax rate being $2.40, it may come down to $1.60 or $1.80 because all of the appraisals went higher. That’s how that works”

According to the state, the process is designed to ensure truth-in-taxation for all Tennessee property owners.

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