North Carolina § 105-381 - Taxpayer's remedies.

§ 105-381. Taxpayer's remedies.

Statement of Defense. - Any taxpayer asserting a valid defense to the enforcement of the collection of a tax assessed upon his property shall proceed as hereinafter provided. For the purpose of this subsection, a valid defense shall include the following: A tax imposed through clerical error; An illegal tax; A tax levied for an illegal purpose. If a tax has not been paid, the taxpayer may make a demand for the release of the tax claim by submitting to the governing body of the taxing unit a written statement of his defense to payment or enforcement of the tax and a request for release of the tax at any time prior to payment of the tax. If a tax has been paid, the taxpayer, at any time within five years after said tax first became due or within six months from the date of payment of such tax, whichever is the later date, may make a demand for a refund of the tax paid by submitting to the governing body of the taxing unit a written statement of his defense and a request for refund thereof. Action of Governing Body. - Upon receiving a taxpayer's written statement of defense and request for release or refund, the governing body of the taxing unit shall within 90 days after receipt of such request determine whether the taxpayer has a valid defense to the tax imposed or any part thereof and shall either release or refund that portion of the amount that is determined to be in excess of the correct tax liability or notify the taxpayer in writing that no release or refund will be made. The governing body may, by resolution, delegate its authority to determine requests for a release or refund of tax of less than one hundred dollars ($100.00) to the finance officer, manager, or attorney of the taxing unit. A finance officer, manager, or attorney to whom this authority is delegated shall monthly report to the governing body the actions taken by him on requests for release or refund. All actions taken by the governing body or finance officer, manager, or attorney on requests for release or refund shall be recorded in the minutes of the governing body. If a release is granted or refund made, the tax collector shall be credited with the amount released or refunded in his annual settlement. Suit for Recovery of Property Taxes. - Request for Release before Payment. - If within 90 days after receiving a taxpayer's request for release of an unpaid tax claim under (a) above, the governing body of the taxing unit has failed to grant the release, has notified the taxpayer that no release will be granted, or has taken no action on the request, the taxpayer shall pay the tax. He may then within three years from the date of payment bring a civil action against the taxing unit for the amount claimed. Request for Refund. - If within 90 days after receiving a taxpayer's request for refund under (a) above, the governing body has failed to refund the full amount requested by the taxpayer, has notified the taxpayer that no refund will be made, or has taken no action on the request, the taxpayer may bring a civil action against the taxing unit for the amount claimed. Such action may be brought at any time within three years from the expiration of the period in which the governing body is required to act. Civil Actions. - Civil actions brought pursuant to subsection (c) above shall be brought in the appropriate division of the general court of justice of the county in which the taxing unit is located. If, upon the trial, it is determined that the tax or any part of it was illegal or levied for an illegal purpose, or excessive as the result of a clerical error, judgment shall be rendered therefor with interest thereon at six percent (6%) per annum, plus costs, and the judgment shall be collected as in other civil actions. History (1901, c. 558, s. 30; Rev., s. 2855; C. S., s. 7979; 1971, c. 806, s. 1; 1973, c. 564, s. 3; 1977, c. 946, s. 2; 1985, c. 150, s. 1; 1987, c. 127.) Local Modification. - Forsyth: 1981 (Reg. Sess., 1982), c. 1154; 1985, c. 150, s. 2. Property Affected by Alamance/Orange County Boundary Changes. - Session Laws 2011-88, s. 5(a)-(d), provides: "(a) Any properties affected by S.L. 2010-61 or this act and which are subject to taxation under G.S. 105-274 and which were taxed by both the Alamance County and Orange County taxing authorities on or after January 1, 2007, are hereby granted the following relief: "(1) Property owners of any such dually taxed properties may, pursuant to the terms of G.S. 105-381 , demand refund and/or release of taxes paid to the county from which their property, or portion thereof, was transitioned. "(2) Any claim for relief pursuant to this section and under the terms of G.S. 105-381 may be made for taxes assessed January 1, 2007, through December 31, 2011. All such claims for relief must be made in writing to the county from which the affected property was transitioned on or before February 28, 2012. Should a claim for relief pursuant to this section not be made by February 28, 2012, such claim is waived, and no further relief shall be granted pursuant to this or any other act. Alamance County and Orange County shall not grant refunds or releases pursuant to this section for any claims made after February 28, 2012, and are released from all liability, and no court action shall be maintained for any such claims made for any act or failure to act pursuant to this section. "(b) The provisions of this section shall apply only to properties transitioned or reassigned from one county to the other, in whole or in part, by the resurveys of individual qualifying properties pursuant to S.L. 2010-61 and this act. "(c) For purposes of this section only, the term 'property owner' shall include any builder or developer that paid property taxes on real property to both counties and subsequently sold said property or that as part of an escrow agreement in which the buyer of such property paid taxes to one county and the builder or developer who sold the property paid taxes on the same piece of property to the adjoining county. "(d) The taxing authorities of Alamance County and Orange County shall notify property owners affected by this section of the terms of this section within 30 days after this act becomes law. Such notice shall be by United States mail at the mailing address to which any tax bills were previously submitted. No other notice is or shall be required." The purpose of Session Laws 2010-61, referred to in subsections 5(a) and (b) of Session Laws 2011-88, was to clarify or reestablish the boundary between Alamance County and Orange County. For a fuller explanation, see the Editor's notes under G.S. 153A-18 . Session Laws 2012-108, s. 5(a)-(d), provides: "(a) Any properties affected by S.L. 2010-61 or this act and that are subject to taxation under G.S. 105-274 and that were taxed by both the Alamance County and Orange County taxing authorities on or after January 1, 2007, are hereby granted the following relief: "(1) Property owners of any such dually taxed properties may, pursuant to the terms of G.S. 105-381 , demand refund and/or release of taxes paid to the county from which their property, or portion thereof, was transitioned. "(2) Any claim for relief pursuant to this section and under the terms of G.S. 105-381 may be made for taxes assessed January 1, 2007, through December 31, 2012. All such claims for relief must be made in writing to the county from which the affected property was transitioned on or before February 28, 2013. Should a claim for relief pursuant to this section not be made by February 28, 2013, such claim is waived and no further relief shall be granted pursuant to this or any other act. Alamance County and Orange County shall not grant refunds or releases pursuant to this section for any claims made after February 28, 2013, and are released from all liability, and no court action shall be maintained for any such claims made for any act or failure to act pursuant to this section. "(b) The provisions of this section shall apply only to properties transitioned or reassigned from one county to the other, in whole or in part, by the resurveys of individual qualifying properties pursuant to S.L. 2010-61 and this act. "(c) For purposes of this section only, the term 'property owner' shall include any builder or developer that paid property taxes on real property to both counties and subsequently sold said property or that, as part of an escrow agreement in which the buyer of such property paid taxes to one county and the builder or developer who sold the property, paid taxes on the same piece of property to the adjoining county. "(d) The taxing authorities of Alamance County and Orange County shall notify property owners affected by this section of the terms of this section within 30 days of this act becoming law. Such notice shall be by United States mail at the mailing address to which any tax bills were previously submitted. No other notice is or shall be required." Editor's Note. - Session Laws 2006-72, s. 1, provides: "A taxing unit's governing body may by resolution provide that, notwithstanding the provisions of G.S. 105-360 regarding the due date and accrual of interest, G.S. 105-380 and G.S. 105-381 regarding the release, refund, and compromise of taxes, and G.S. 160A-58.10 regarding the taxation of newly annexed property, property taxes for the partial fiscal year October 1, 2005, through June 30, 2006, shall be collected over a three-year period with one-third due and payable on September 1, 2006, one-third due and payable on September 1, 2007, and the remaining one-third due and payable on September 1, 2008. The resolution may provide that interest accrues on unpaid property taxes only to the extent that the property taxes have become due and payable under the payment schedule set out in the resolution. To the extent property taxes are due and payable pursuant to a resolution adopted under this act, interest accruing on taxes that remain unpaid shall be computed according to the schedule stated in G.S. 105-360 . A resolution adopted pursuant to this act applies only to taxes for the partial fiscal year October 1, 2005, through June 30, 2006, on property located in an area that was annexed between January 1, 2003, and January 1, 2006, and for which effective date of the annexation was set by judicial order." Session Laws 2006-72, s. 2, provides: "If a resolution adopted by a taxing unit's governing body pursuant to this act delays the due date, accrual of interest, or both for any property taxes, the tax collector's obligations under G.S. 160A-58.10 and G.S. 105-360 with respect to those taxes are delayed to the same extent." Legal Periodicals. - For survey of 1979 tax law, see 58 N.C.L. Rev. 1548 (1980).