2023 Tennessee Code › Title 67 - TAXES AND LICENSES (§§ 67-1-101 — 67-10-107) › Chapter 5 - PROPERTY TAXES (§§ 67-5-101 — 67-5-2803) › Part 6 - CLASSIFICATION AND ASSESSMENT - VALUATION (§§ 67-5-601 — 67-5-607) › Section 67-5-603 - Property damage - Improvements to property

(a)
(1)
If, after January 1 and before September 1 of any year, a building or improvement shall be moved, demolished or destroyed, or substantially damaged by fire, flood, wind or any other disaster, and is not restored and no other improvement is constructed in its place before September 1 of that year, the assessor of property shall make or correct the assessment of such property on the basis of the value of the property after such move, destruction or substantial damage of the improvements, notwithstanding the status of the property as of the assessment date of January 1; provided, that for the year in which such improvement is moved, demolished, destroyed, or so damaged, the assessment of the improvement shall be prorated for the portion of the year prior to the date of such move, destruction or damage. This section shall not apply to the movement of a mobile home or other movable structure as defined in §
67-5-501
.
(2)
The state, county, or municipal tax collector shall collect taxes on the basis of the revised or corrected assessment as prorated by the assessor.
(3)
An improvement shall be deemed substantially damaged when as a consequence thereof it has been rendered unfit for use or occupancy, or when such damage has reduced the value of the improvement by more than fifty percent (50%).
(b)
(1)
If, after January 1 and before September 1 of any year, an improvement or new building is completed and ready for use or occupancy, or the property has been sold or leased, the assessor of property shall make or correct the assessment of such property, on the basis of the value of the improvement at the time of its completion, notwithstanding the status of the property as of the assessment date of January 1; provided, that for the year in which such improvement or building is completed, the assessment, or increase in assessment, of the improvement shall be prorated for the portion of the year following the date of its completion.
(2)
The state, county or municipal tax collector shall collect taxes on the basis of the revised or corrected assessment as prorated by the assessor.
(3)
For the purpose of assessment, an improvement or new building shall be deemed completed and ready for use or occupancy when the structural portion of the building or improvement is substantially completed, even though the interior finish or certain appointments may be left to the choice of a prospective buyer or tenant after consummation of a sale or lease of the property.
(4)
Any improvement or new building shall be deemed completed and to have a value for assessment purposes when the real property upon which such improvement or new building is located shall have been conveyed to a bona fide purchaser, or when such new building or improvement has been occupied or used or shall be suitable for occupancy or use, whichever shall first occur. In no event shall any improvement or new building be considered incomplete for valuation or assessment purposes for more than one (1) calendar year immediately following the date on which such construction was commenced.
(5)
In the event an improvement or new building shall be considered incomplete for assessment purposes on January 1 of any year, the owner of such improvement or new building shall, not later than February 1 of that year, submit to the assessor of property, in writing, the total cost of all materials used in such incompleted structure as of January 1, and the assessor of property shall assess such incomplete structure as real property, based on the fair market value of the materials used therein. Actual cost of all materials shall be prima facie evidence of the value of such incompleted improvements.
(c)
In order to assist assessors of property in locating improvements to property, including new buildings and additions to existing buildings, in counties where building permits are not required, the state director of fire prevention shall each month provide to assessors of property of such counties the names of property owners and location of the property for which electrical inspections have been made. The location of the property shall be given with reference to the assessor's map and parcel identification number. In addition, in counties that do not require building permits, copies of permits for subsurface sewage disposal systems shall be furnished to the assessor of property of the county where such systems are located by the agency issuing such permits.
(d)
In the case of damage as a result of a disaster declared by the president of the United States, the annual assessment of an affected building or improvement in a county included in the presidential declaration must be prorated as otherwise provided in subsection (a), for the actual time the building or improvement is destroyed and not replaced, or the actual time the building or improvement is substantially damaged, notwithstanding the building or improvement is restored or replaced by September 1; provided, the total time the building or improvement is destroyed or damaged and not replaced or restored, exceeds thirty (30) days. The owner must apply for this relief to the assessor of property by September 1 using a form approved by the director of the state division of property assessments. This subsection (d) shall not take effect as to any particular county or municipality unless approved by a two-thirds (2/3) vote of its governing body following the disaster being declared by the president of the United States.
Amended by 2023 Tenn. Acts, ch. 259,s 3, eff. 4/28/2023.
Amended by 2017 Tenn. Acts, ch. 11, s 1, eff. 3/24/2017.
Acts 1973, ch. 226, § 6; 1974, ch. 555, § 1; T.C.A., §§ 67-607, 67-608; Acts 1986, ch. 507, § 1; 1991, ch. 15, § 1; 2010 , ch. 1036, § 3.