H 4307 Session 110 (1993-1994)
H 4307 General Bill, By J.J. Bailey, R.S. Corning, Inabinett and Richardson
A Bill to amend the Code of Laws of South Carolina, 1976, by adding Section
12-37-224 so as to exempt from ad valorem taxes an amount of the fair market
value of residential real property assessed at four percent of fair market
value and real property assessed at six percent of fair market value that
represents increases in fair market value occurring after the year ownership
of the property was last transferred and provide exceptions and to impose a
property transfer tax on the transferors of property benefitting from the
exemption allowed by this Section and provide for the rate, time of payment,
and method of collection and distribution.
12/01/93 House Prefiled
12/01/93 House Referred to Committee on Ways and Means
01/11/94 House Introduced and read first time HJ-15
01/11/94 House Referred to Committee on Ways and Means HJ-15
A BILL
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976,
BY ADDING SECTION 12-37-224 SO AS TO EXEMPT FROM AD
VALOREM TAXES AN AMOUNT OF THE FAIR MARKET VALUE
OF RESIDENTIAL REAL PROPERTY ASSESSED AT FOUR
PERCENT OF FAIR MARKET VALUE AND REAL PROPERTY
ASSESSED AT SIX PERCENT OF FAIR MARKET VALUE THAT
REPRESENTS INCREASES IN FAIR MARKET VALUE
OCCURRING AFTER THE YEAR OWNERSHIP OF THE
PROPERTY WAS LAST TRANSFERRED AND PROVIDE
EXCEPTIONS AND TO IMPOSE A PROPERTY TRANSFER TAX
ON THE TRANSFERORS OF PROPERTY BENEFITTING FROM
THE EXEMPTION ALLOWED BY THIS SECTION AND PROVIDE
FOR THE RATE, TIME OF PAYMENT, AND METHOD OF
COLLECTION AND DISTRIBUTION.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Article 3, Chapter 37, Title 12 of the 1976 Code is
amended by adding:
"Section 12-37-224. (A) In addition to property tax
exemptions allowed pursuant to Section 12-37-220(b), there is allowed
as an exemption from ad valorem taxation an amount of the fair market
value of residential real property assessed pursuant to Section
12-43-220(c) and real property and improvements thereon assessed
pursuant to Section 12-43-220(e) equal to increases in fair market value
resulting from reassessments occurring after the year the present owner
acquired ownership. When the property is transferred, its value for
purposes of ad valorem taxation is its fair market value at that time.
This exemption does not extend to increases in fair market value
attributable to permanent improvements made to the property. For
purposes of this exemption, the acquisition of residential property
assessed pursuant to Section 12-43-220(c) by a spouse by gift or by a
surviving spouse by devise or operation of law is not considered a
change of ownership.
(B) When ownership of property receiving the exemption allowed
pursuant to subsection (A) of this section is transferred and has a higher
valuation on the date of the transfer, there is imposed on the transferor
a real property transfer tax equal to the difference between the tax due
on the property for the last tax year before the transfer and the tax that
would have been due for that year without the benefit of the exemption.
The transfer tax is due and payable to the county treasurer of the county
where the property is located at the time of closing. A penalty equal to
five percent of the tax must be added to the tax due for each thirty days
or portion of thirty days the tax remains unpaid but the total penalty may
not exceed twenty percent. The transfer tax liability is personal to the
transferor and may be enforced and collected by the county treasurer in
the same manner that state income taxes are enforced and collected,
mutatis mutandis. When ownership of a portion of property receiving
the exemption is transferred, the transfer tax must be allocated
proportionately in the manner that the Department of Revenue and
Taxation shall prescribe. Proceeds of the transfer tax are considered
property taxes and must be distributed to taxing entities in the same
proportion that an equal amount of property tax would have been
distributed for the applicable tax year."
SECTION 2. This act takes effect January 1, 1994, and applies only
with respect to increases in fair market value resulting from
reassessments occurring after 1992. No refunds must be paid for the
1993 property tax year as a result of the exemption established by this
act.
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