OPM: Statutes Governing Property Assessment and Taxation

Statutes Governing Property Assessment and Taxation
 


Program Description

The Office of Policy and Management (OPM) has limited authority in the area of property assessment and taxation. OPM issues guidelines for property tax exemption and tax credit programs for which municipalities receive state reimbursement for their tax losses. OPM determines annual personal property taxes for certain companies that provide telecommunications services. OPM also prescribes the application that a taxpayer uses to obtain maritime heritage land classification.

OPM staff members do not have the authority to waive property taxes or the interest on delinquent property taxes. They do not have the authority to override a determination that a local assessor or tax collector makes, nor do they issue legal opinions about property assessment and taxation legislation that town officials administer.

 

Because property taxation affects the vast majority of Connecticut’s residents, OPM provides general information to assist taxpayers in understanding this tax.  This information appears below under the following topic headings: Connecticut’s Property Tax Framework, Waiver of Taxes or Interest, Correcting Clerical Mistakes and Obtaining Tax Refunds, Real Estate, Personal Property, Motor Vehicles, and Property Tax Exemptions and Abatements.

Some explanations contain references to Chapters of the Connecticut General Statutes and statutory section references. Links to these chapters are available . 

 

Connecticut Law Regarding Property Assessment and Taxation

Chapter 201 - State and Local Revenue Services; Department of Revenue Services

Chapter 203 - Property Tax Assessment

Chapter 204 - Local Levy and Collection of Taxes

Chapter 204a - Property Tax Relief for Elderly Homeowners and Renters and Persons with Permanent Total Disability

 

2010 State Legislation Impacting Municipal Assessment and Taxation

A compilation of pertinent sections of public and special acts that the Connecticut General Assembly enacted in 2010 is available. 

 

2010 State legislation Impacting Municipal Assessment and Taxation (PDF)

 

 

The following information is merely a general guide to state laws affecting property assessment and taxation.

Waiver of Taxes or Interest Taxes; Correcting Clerical Mistakes and Obtaining Refunds; Real Estate; Personal Property; Motor Vehicles; Property Tax Exemptions, Abatements, and Credits

 

Connecticut’s Property Tax Framework

There are 169 cities and towns in Connecticut. Each provides various services, such as public school education, police and fire protection and public road maintenance. To a large extent, the property tax finances these services. Connecticut state law authorizes the taxation of property, including real estate, motor vehicles, business-owned personal property that some personal property that individuals own.

Local governmental officials administer the property assessment and taxation.  State law governs the manner in which a town or city assessor determines property assessments and the procedures that tax collectors use to collect property taxes. State law also authorizes property tax exemptions, credits and abatements. 

Some cities and towns contain specific taxing districts, such as fire districts, that provide services that the city or town does not provide. The assessment of property that a city or town assessor determines is the basis for the tax that a district collects.

In Connecticut, the assessment date is October 1 (Chapter 203 - Sec. 12-62a). Ownership of property on an assessment date makes a taxpayer liable for property taxes, unless the property is exempt from taxation. Certain property of non-residents may also be subject to taxation if located in Connecticut for a period of time prior to an assessment date (Chapter 203 - Sec. 12-43).

The grand list is a record of all taxable and tax exempt property in a taxing jurisdiction as of the assessment date. Assessors generally file the grand list by the end of January, but some may do so by the end of February.  If the assessment of real estate or personal property other than a motor vehicle increases from one assessment date to the next, an assessor must send an increase notice to the affected taxpayer (Chapter 203 - Sec. 12-55).

A taxpayer who disagrees with an assessor’s determination regarding an assessment has the right to submit a written request for a hearing to a local board of assessment appeals (Chapter 203 - Sec. 12-111). The date for submitting a hearing request is either February 20 or March 20, depending on when the grand list is completed; hearings occur in March or April. Boards of assessment appeals also meet at least once during the month of September to hear appeals related to motor vehicle assessments (Chapter 203 – Sec. 12-112).   A taxpayer must appear at a hearing before the board of assessment appeals, or must ensure that someone appears on the taxpayer’s behalf (Chapter 203 – Sec. 12-113). If a taxpayer disagrees with a determination of a board of assessment appeals, the taxpayer may file an appeal with the superior court for the judicial district in which the property is located (Chapter 203 – Sec. 12-117a).

After the board of assessment appeals finalizes determinations for hearings held in March or April, a taxing jurisdiction determines the amount of property tax revenue that it will need for the upcoming fiscal year and sets a mill rate. Multiplying the mill rate (the basis for which is a thousandth of a dollar) by a property’s net assessment results in the property tax. The net assessment of a property is the assessment minus all exemptions for which a taxpayer qualifies.

Although a taxpayer establishes a property tax liability as of October 1, a tax collector does not mail a tax bill for that liability until the following June. (A tax collector may mail a tax bill even later if there is a delay in establishing the mill rate.)  Also, tax collectors do not mail tax bills for some motor vehicles until the following January. While state law requires tax collectors to mail tax bills, it also specifies that a tax collector’s failure to do so does not invalidate the tax (Chapter 204 - Sec. 12-130). 

Local jurisdictions determine whether property taxes are due in one or more installments.  State law provides a 30-day grace period for a property tax payment (Chapter 204 - Sec. 12-142). If a taxpayer pays a tax after the 30-day grace period, the payment is delinquent. State law requires tax collectors to add interest, at the rate of 1 ½ percent per month or any portion of a month, to a delinquent tax bill (Chapter 204 - Sec. 12-145).  For example, a tax due July 1 is payable on or before August 1.   If the tax is paid August 2, interest equals 3% (1 ½ percent for July and 1 ½ percent for August).  

Interest becomes part of the property tax when a tax collector imposes it. Tax collectors cannot accept a partial payment of a delinquent tax that is less than the total of the accrued interest on the principal of the tax. Each payment reduces the interest before reducing the principal (Chapter 204 - Sec. 12-145).

Tax collectors may issue tax warrants to collect outstanding property taxes (Chapter 204 - Sec. 12-135). They may initiate foreclosure proceedings with regard to delinquent real estate taxes (Chapter 204 - Sec. 12-157).  They may report taxpayers who are delinquent in paying motor vehicle property taxes to the Department of Motor Vehicles, in which case the taxpayer cannot obtain a registration or registration renewal without providing proof of payment of the outstanding tax.  Municipalities may refer delinquent taxpayers to collection agencies and may also use other means to collect taxes that are delinquent.

State law allows for the collection of property taxes within 15 years after a tax due date (Chapter 204 - Sec. 12-164).

 

Waiver of Taxes or Interest Taxes

The chief elected official of towns, cities and boroughs may abate a tax or interest for a person who is poor and unable to pay, or for a railroad company under certain circumstances (Chapter 204 - Sec. 12-124).  A municipality’s legislative body (or its board of selectmen in a town in which the legislative body is a town meeting) may abate the property tax for an owner-occupied residential dwelling, to the extent that the tax exceeds 8% or more of the total income of all occupants (Chapter 204 - Sec. 12-124a).  

A tax collector may waive the interest on delinquent property taxes if the tax collector and the assessor, jointly, determine that the delinquency is attributable to an error by the tax assessor or tax collector and is not the result of any action or failure to act on the part of the taxpayer (Chapter 204 - Sec. 12-145).  Also, state law requires a municipality to waive interest on a delinquent tax for any taxpayer who received compensation from the State of Connecticut ’s Office of Victim Services (Chapter 204 - Sec. 12-146).

 

Correcting Clerical Mistakes and Obtaining Tax Refunds

An assessor has the authority to correct a clerical error or omission in a property assessment within the time period that state law allows (Chapter 203 – Sec. 12-60). An assessor also has the authority to issue a certificate of correction regarding personal property within a specified time period and to issue corrections regarding certain motor vehicles (Chapter 203 – Section 12-57).

If a correction occurs after a tax payment is made, a taxpayer may send a written request for a refund of an overpayment to the tax collector, not later than three years from the date the tax was due (Chapter 204 – Sec. 12-129).  State law provides a more extensive time period for the recovery of a tax overpayment by a member of the United States armed forces or a surviving spouse or sole surviving parent of certain veterans (Chapter 204 – Sec. 12-128).

 

Real Estate

Real estate is all land and all improvements on or to land (such as buildings, fences, and paved driveways), as well as easements to use air space (Chapter 203 - Sec. 12-64).

With the exception of certain classified land, the assessment of each parcel of real property represents 70% of its estimated fair market value as of the date of a revaluation (Chapter 203 - Sec. 12-62, Sec. 12-62a and Sec. 12-63).  Assessors value classified farm, forest, open space and maritime heritage on the basis of use, rather than on a fair market value basis (Chapter 203 - Sec. 12-107b through Sec. 12-107f and Public Act 07-127).

When a revaluation occurs, an assessor establishes the current fair market value of all real estate, in order to equalize the tax burden among property owners.   While assessors must revalue all real estate not later than five years after the October 1 effective date of the previous revaluation, they may revalue real estate more often than once every five years (Chapter 203 - Sec. 12-55 and Sec. 12-62).

Before a revaluation becomes effective, taxpayers may receive questionnaires so that they may verify information concerning their properties. At least once in every 10 assessment years, an assessor (or an assessor’s designee) may request a taxpayer’s permission to enter a building, in order to verify its condition and other information the assessor needs to establish its fair market value (Chapter 203 - Sec. 12-63). State law also imposes reporting requirements that affect owners of certain income-producing real estate in conjunction with revaluations (Chapter 203 - Sec. 12-63c).

Cities and towns may choose to phase in real estate assessment increases when implementing a revaluation.  They may phase in all or a portion of the increase for up to five years (Chapter 203 – Sec. 12-62c).

Upon the completion of new construction (including building additions) in any year after the effective date of a revaluation, a taxpayer’s property assessment increases.  The increase represents the portion of an assessment year during which the newly constructed improvement may be used for its intended purpose (Chapter 203 - Sec. 12-53a). Under certain circumstances, a real estate assessment reduction may occur during an assessment due to the demolition of a building (Chapter 203 - Sec. 12-64a).

 

Personal Property

In general, personal property is anything that is moveable and is not a permanent part of real estate, including items such as business-owned furniture, fixtures, machinery or equipment, as well as horses and unregistered motor vehicles and snowmobiles that anyone owns (Chapter 203 - Sec. 12-71).

A taxpayer must file a Personal Property Declaration with the assessor of the city or town in which personal property is subject to taxation by November 1, annually (Chapter 203 - Sec. 12-41). An assessor may grant a taxpayer an extension of up to 45 days to file a declaration (Chapter 203 - Sec. 12-42). Nonresident taxpayers must file a declaration (Chapter 203 - Sec. 12-43).

Lessees of personal property must also file a report with assessors by November 1, annually. This requirement affects any personal property (other than a Connecticut registered motor vehicle) that is subject to a contract of lease and is in a lessee’s possession (Chapter 203 - Sec. 12-57a).

On a Personal Property Declaration, a taxpayer provides information concerning the year of acquisition of personal property, as well as the original cost of acquisition, freight and installation.  Assessors apply depreciation to the total cost a taxpayer declares to obtain the depreciated value of personal property. The assessment of the property is 70% of the depreciated value.  

If a taxpayer files a Personal Property Declaration subsequent to the date it is due, the assessor adds a 25% assessment penalty to the taxpayer’s assessment. A 25% assessment penalty is also applicable if a taxpayer fails to file a declaration, in which case an assessor uses the best information available to determine the value of the taxpayer’s personal property (Chapter 203 – Sec. 12-41 and Sec. 12-42).

An assessor (or an assessor’s designee) may conduct an audit regarding a taxpayer’s personal property. If an audit reveals that a taxpayer omitted property from a declaration or did not accurately report personal property costs, state law provides for a 25% assessment penalty. Interest is applicable to the tax for such property from the tax due date for the assessment year to which the audit relates (Chapter 203 – Sec. 12-53).

 

Motor Vehicles

In general, motor vehicles are subject to taxation in the city or town where, in the normal course of their operation, they most frequently leave from and return to or remain, although state law provides some exceptions to this general rule (Chapter 203 – Sec. 12-71). 

The assessment of a motor vehicle is 70% of its average retail value. Generally, assessors use average retail values that the National Automobile Dealer’s Association (NADA) compiles annually. Assessors are responsible for determining the value of any motor vehicle for which the NADA Guide does not provide an average retail value.

All motor vehicles a taxpayer owns on an assessment date are subject to taxation, regardless of whether the Department of Motor Vehicles issues a Connecticut registration for them. Taxes for such vehicles are due the following July 1.   Motor vehicles registered subsequent to October 1 are also subject to taxation.  The assessment of a vehicle registered between November 1 and the following July 31, which represents only a portion of the assessment year, is included on a supplemental grand list. Supplemental grand list taxes are due on the January 1 following the conclusion of the assessment year in which the registration of these vehicles occurs.

A property tax reduction or credit is available when a taxpayer sells a motor vehicle and does not replace it with another vehicle.  If a taxpayer replaces one vehicle with another, the assessor reduces the assessment of the replacement vehicle on the supplemental grand list to reflect the credit (Chapter 203 - Sec. 12-71b).

A property tax reduction or credit is also available for a totally destroyed vehicle and for a vehicle that a taxpayer registers in another state when the taxpayer becomes a resident of that state during an assessment year.  Taxpayers must claim this credit within the time period that state law prescribes (Chapter 203 - Sec. 12-71c).

 

Property Tax Exemptions, Abatements and Credits

State law authorizes various property tax exemptions for Connecticut residents, some of which are available in every city and town. Examples include exemptions for veterans of certain conflicts, certain survivors of deceased veterans and active duty members of the armed forces of the United States or the Connecticut National Guard who serve during certain periods.  Exemptions are available to persons who are legally blind or who are totally and permanently disabled.  Additionally, certain property (such as manufacturing machinery and equipment, air or water pollution control equipment, and property that a religious organization or an eligible non-profit entity owns) may be either totally or partially exempt from taxation (Chapter 203 – Sec. 12-81).

Some property tax exemptions are available only in a city or town that authorizes them via adoption of an ordinance (Chapter 203 – Sec. 12-81n through Sec. 12-81bb). Property tax abatements may also be available for certain types of new construction or rehabilitation in areas of cities or towns (Chapter 203 - Sec. 12-65 to Sec. 12-65h) and cities or towns may also authorize tax abatements of up to 50% for certain types of property uses (Chapter 203 - Sec. 12-81m).

The statutes that govern property tax exemptions set forth eligibility and application filing requirements.

Property tax credits are available to income-eligible elderly and totally disabled homeowners; the State of Connecticut reimburses local taxing jurisdictions for their tax losses due to such credits ( Chapter 204a – Sec. 12-170aa). Cities and towns may offer additional tax relief programs to income-eligible elderly and totally disabled homeowners (Chapter 204 – Sec. 12-129n). Cities and towns may also offer property tax relief to income-eligible homeowners who are 70 years of age or older (Chapter 204a – Sec. 12-170v).

The State of Connecticut also provides direct payments to income-eligible elderly and totally disabled renters (Chapter 204a – Sec. 12-170d).

 
 
Previous Years


For Further Information, Please Contact:
Shirley Corona: phone (860) 418-6221: fax (860) 418-6493 - e-mail shirley.corona@ct.gov





Content Last Modified on 10/20/2011 3:19:06 PM