Your Fulton County Property Taxes and the Homestead Fair Assessment Act: SB 610

By Sam Zamarripa, State Senator D-36

During my first term in the State Senate I introduced and passed a bill called the Homestead Fair Assessment Act (HFAA) SB 610. The bill created a county wide referendum in Fulton County during the 2004 election year. The referendum passed with an overwhelming majority and became law in 2005. In simple terms this tax bill was designed to give Fulton County home owners some stability and predictability in their Fulton County property taxes.

Now that the bill has become the law in Fulton County, most homeowners should see a reduction in their property taxes. These reductions and the value of future property tax bills will depend on a number of important factors, especially the mileage rate that is set each year by the Fulton County Commission. In general however, the HFAA should achieve its goals of making your Fulton County Tax bill more predictable and stable on a year by year basis. I believe this will encourage long term homeownership in Fulton County and that it will be especially helpful to retired people, first time home owners and the working families of my district.

As the HFAA is implemented there will be many questions about how it works, how it is applied and how the property taxes are calculated. To assist you and your neighborhood associations in dealing with the new provisions of the HFAA, we have put together a number of commonly asked questions and, to the best of our ability tried to simplify the process of the legislation. Also, I have created a community Q&A on my web site especially for the HFAA. If you have comments or experiences that you would like to share on this law please post you comments on the HFAA section at www.zamarripa.com.

I want to thank many people who helped with the final development of the SB610 and with this questionnaire.

Sam Zamarripa
State Senator
[email protected]


Q. What is the HFAA?

The HFAA was adopted in the 2004 Session of the Georgia General Assembly and approved overwhelmingly in a referendum of Fulton county voters in November 2004. Its provisions are effective for 2005 and basically provide that a taxpayer’s homestead exemption for Fulton County taxes (not any city taxes or school taxes) will increase dollar for dollar by the amount a home’s assessed value increases above its 2003 inflation adjusted assessed value.

Q. What is “inflation adjusted value”?

Assuming you own homestead property in 2005, for 2005 it would be equal to the property’s 2003 assessed value (40% of fair market value). For 2006, it would be the property’s 2003 assessed value plus the lesser of the 2005 CPI Inflation percentage or 3%.

Q. What types of real property does HFAA apply to?

HFAA applies only to residential real property with respect to which a homestead exemption has been claimed and allowed.

Q. I have not filed a homestead exemption. Am I still eligible for the benefits of the HFAA?

If you have never filed a homestead exemption for your property, you will not be eligible for the HFAA (generally, you are only required to file once, then the exemption renews from year to year). However, you may still be able to file a homestead exemption for the 2005 tax year. You should contact the Fulton County Tax Assessor’s office if you have any questions regarding the filing of a homestead exemption or whether your property is subject to a homestead exemption.

Q. I live in City of Atlanta, but in Dekalb County. Will I see any benefits from the HFAA?

No. The HFAA applies only to Fulton County taxes and therefore only to Fulton County residents.

Q. How does HFAA affect right of survivorship?

The bill allows the ownership of homestead property to be changed into a joint tenancy with a right of survivorship until the 2006 taxable year. Thus, if ownership is currently in a different form, a homeowner should evaluate whether he or she should transfer the home into a joint tenancy to allow his or her domestic partner to enjoy the benefit of the protections contained in HFAA. Because the ownership of property and eligibility for a homestead is determined as of January 1 of each year, you should make any necessary changes prior to January 1, 2006. If you have any questions about how to do so you should consult with an attorney.

Q. My home was reassessed this year – how can they do that?

The Tax Assessor’s office is required under law to assess your home at its fair market value. The Tax Commissioner’s office then calculates your taxes based upon this value and the millage rates adopted by the various taxing jurisdictions and applies any exemptions. Because the HFAA provides for an increased homestead exemption (and not a cap on valuation) you will see its affect on your tax bill, not on your assessment.

Q. Is there any need to appeal my reassessment now that the HFAA is law?

If you feel that your reassessment does not accurately reflect the value of your home or is not uniform with the assessments others have received, you should still appeal your reassessment. The HFAA applies only to Fulton County taxes (not any city school taxes or city taxes) so other taxes will be calculated based upon the current assessed value of your home and the HFAA will not provide any additional exemption for those taxes.

Q. My house was assessed at $400,000 in 2003 and has been reassessed at $500,000 for 2005. What is the HFAA exemption for my home?

In Georgia, a property’s assessed value is 40% of its fair market value (as determined by the Tax Assessor). Thus, your increased exemption should be calculated as follows:

2003 Appraised FMV - $400,000 = $160,000 assessed value
2005 Appraised FMV - $500,000 = $200,000 assessed value

Using these numbers, your additional HFAA exemption (in addition to the homestead exemption you already receive in Fulton County) should be $40,000 for 2005.

Q. What if I bought by house in 2003 or 2004? Will the HFAA provide a benefit to me this year?

In Georgia, the tax status and value is determined on January 1st of each year. We believe that under the HFAA, the “base year value” for determining the increased homestead exemption under the HFAA should be its 2003 value, regardless of whether you purchased your home in 2003 or 2004.

Q. What happens when someone sells their property?

When a homeowner sells their property, the county may revalue the property tax to the full value of the existing valuation without regard to any existing HFAA exemption on the property, the 3% cap or the CPI. In other words, new home owners will pay a higher rate or level than a previous home owner. However, even though the rate and level will be increased, the new home owner will benefit in the next tax year because the HFAA will protect them against assessment increases of more than 3% or the CPI.

Q. What if I add an addition to my property?

If you make an addition in 2005, then the HFAA does not immediately provide an increase in your homestead exemption of the value of the improvements. Thus you will be taxed on the full value of those improvements in 2006. However, increases in the value of those improvements in subsequent years will be subject to the provisions of the HFAA. Here is an example:

2003 Appraised FMV - $400,000 = $160,000 assessed value
2005 Appraised FMV - $500,000 = $200,000 assessed value
2006 Appraised FMV - $600,000 = $240,000 assessed value
Value of improvements made during 2005 = $50,000 (x 40%=$20,000).
CPI Inflation Percentage for 2005 (hypothetical, actual will be determined based on the CPI): 3%

Of the $40,000 increase in the assessed value for 2006, $20,000 was attributable to the value of the improvements. Therefore, the HFAA exemption would be as follows:

2006 Assessed Value $240,000
-Capital Improvements (20,000)
Value Eligible for HFAA Exemption: $220,000

2003 Assessed Base Year Value: $160,000
+Inflation Adjustment 4,800
Adjusted Base Year Value: (164,800)

HFAA Exemption for 2006
$55,200