Apartment, home owners get same tax exemptions

Apartment, home owners get same tax exemptions

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Do apartment residents pay their own way when it comes to property taxes used by the city and county to police streets, provide utilities and educate children? That has been the question asked by many Morgan City residents lately after hearing of a developers plan to bring 24-plex apartments to the Mahogany Ridge area. Many residents are worried that for the influx of new residents dwelling in apartments, the stress on the local public schools and city sewer system would be too great. The answer can be found on property owners tax forms. The short answer is that an apartment complex owner and a single-family home owner get the same tax breaks, said Morgan County Assessor Gwen D. Rich. Apartment complexes get primary residence exemptions, because it is someones primary residence, Rich said. A primary residence exemption means that although a house is worth $200,000, the owner living in the home year-round only has to pay property taxes as if their home were only worth roughly half that, or $100,000. If a home were a vacation home, where the owner only lived there for a few weeks out of the year, the property owner would have to pay property taxes for a full 100 percent of the market value. The fact that an apartment complex can be considered a primary residence for tax purposes is something set by the state and is in line with the method all other counties in the state follow, Rich said. Take the following example: Parkside Properties LLC has three apartment complexes along 250 East (at 205 N., 215 N. and 225 N.), each with four units, on about a third an acre, with 1,888 square feet above grade, and market valued at $256,000. However, the taxable value was $140,800 after taking into account the primary residence exemption. The owner had to pay $1,785 in property taxes for each building in 2014. In comparison, for the highest valued single-family home on that same 250 East street (with a market value of $207,586, taxable value of $114,172, on 0.41 acres, and with 2,422 square feet above grade), the owner had to pay $1,448 in property taxes in 2014. So, with four families living in an apartment building, the owner had to pay $1,785 in property taxes while one family in a home on the same street had to $1,448 in 2014. These figures were obtained from the online version of the Morgan County tax roll, which became available on the assessor tab of the county website in November. The Morgan County tax roll is now online at www.morgan-county.net/MCTaxRoll.aspx. The database includes market, taxable, land and improvement values from 2001 through 2015. It also includes owner names, square footage, year built, property addresses, acreage, parcel numbers, legal descriptions, taxes charged and escrow processing companies. The good news, Rich said, is that an apartment complex is usually valued higher than a home. While the tax rate and exemption may be the same for a homeowner and an apartment building owner, the apartment building owner usually ends up paying more in property taxes because his building is worth more, she said. The selection of apartments in Morgan County includes six properties all within city limits, including: ¢ the Steven and Shelly Hopkin family apartments on 700 East (320 through 328 N.); ¢ the Gaylene C. Kimbal fourplex at 325 N. 400 East near the industrial park; ¢ the Parkside Properties LLC (Johansen) three apartment buildings along 250 East with backyards backing onto Riverside Park (at 205 N., 215 N. and 225 N. 250 East); ¢ the four complexes behind River Burger off of State Street; ¢ Riverview Land LLCs three complexes off of State Street near the post office; ¢ and the Riverview Land LLC (Walker) Apartments across the street from Morgan Middle School (160 East through 174 E. Young Street). Slim pickings means constant demand for the countys multi-family offerings. Since the countys few apartment buildings are usually full, Rich gives no allowances for vacancy rates (as might be found in more urban areas). Apartments in constant demand therefore translate into higher property taxes.

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