The Alabama legislature in its most recent session passed House Bill 73 capping any increase in property taxes at Seven Percent (7%) from the prior year’s valuation (the “Cap”). This Cap applies to both residential (Class III defined properties) and commercial properties (Class II defined properties). Governor Ivey signed the bill into law on May 16, 2024.
Specifically excluded from the Cap are the following properties:
- Properties that have never been assessed;
- Properties improved with additions or new construction (but not ordinary maintenance);
- Properties undergoing a change in classification;
- Certain changes in ownership of properties; and
- Properties in tax increment districts.
The Cap on property tax increases goes into effect on October 1, 2024, and continues through the fiscal year beginning October 1, 2027 (the “Termination Date”). The Alabama legislature would have to re-approve and institute the Cap following the Termination Date for it to be effective moving forward.
About Christian & Small
Christian & Small LLP represents a diverse clientele throughout Alabama, the Southeast, and the nation with clients ranging from individuals and closely held businesses to Fortune 500 corporations. By matching highly experienced lawyers with specific client needs, Christian & Small develops innovative, effective, and efficient solutions for clients. With offices in Birmingham, metro-Jackson, Mississippi, and the Alabama Gulf Coast, Christian & Small focuses on the areas of litigation and business, is a member of the International Society of Primerus Law Firms, and is a Mansfield Rule™ Participating Law Firm. Our corporate social responsibility program is focused on education, and diversity is one of Christian & Small’s core values.
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