Skip to main content

Prorates

Property Value Adjustments During the Tax Year

According to Tennessee Code § 67-5-603, the law allows for property assessments to be adjusted when certain changes to a property occur between January 1 and September 1 of a given year. These changes can either decrease or increase the value of a property for the given year and will therefore adjust the property’s assessed value.

The Property Assessor’s office finds out about changes to a property through several ways:

  • Permit documents/data
  • Public & private county property databases
  • Permit inspections
  • Routine visual inspections

Property Value Decreases

A property’s assessed value may be reduced if a major change takes place that lowers its overall value. This can be because of a demolition/removal, fire damage, natural disaster damage, unfinished construction, or many other scenarios. Our office finds out about these events through the previously stated methods along with several others:

  • Fire reports from surrounding fire departments
  • County code administration
  • Direct notifications from property owners (followed by a required inspection)

Property Value Increases

A property’s value may be increased if new construction or improvements are made between January 1 and September 1 and are “completed and ready for use or occupancy.” According to state law, this means that while finishing touches may still be pending (like interior design choices), the structural work is substantially complete.

This can include:

  • A newly built home
  • Room additions or major renovations
  • Completion of a commercial structure

Incomplete Construction

If a building is incomplete as of January 1, property owners are required to report it. The law states that the owner must submit the total cost of materials used in the structure as of January 1 in writing to the Property Assessor’s Office by February 1 of that year. The Assessor will then assess the property based on the fair market value of those materials. The cost submitted will be treated as the starting point for determining value.

Calculating Adjustments

Whether a property’s value goes up or down due to qualifying changes, the adjustment is prorated. This means the change will apply only to the part of the year when the change was in effect. For example, if a building was destroyed in June, the adjusted value would apply from June through the end of the tax year.

If you believe your property may qualify for a mid-year adjustment due to changes like those described above, Contact Us or Request a Field Review.