Taxes, Ad Valorem

Plain English Breakdown

The bill summary does not provide specific details on how the tax relief will be implemented or what forms it might take.

Tennessee Property Tax Relief Act

This bill amends Tennessee law to require that 10% of any remaining proceeds from a property tax sale be used for tax relief for certain homeowners.

What This Bill Does

• Changes the order in which extra money from a property tax sale is given out, adding a new rule that requires 10% of any remaining money after other payments are made to go towards providing tax relief.

Who It Names or Affects

• Homeowners who are elderly, have a low income, are disabled, or are disabled veterans or widows of disabled veterans.
• Courts that handle property tax sales
• Taxing entities like cities and counties

Terms To Know

Delinquent taxes

Taxes that have not been paid on time.

Property tax sale

A sale of property to pay off unpaid taxes.

Limits and Unknowns

• The exact impact on local government revenue and expenses cannot be determined due to many unknown variables.
• This bill does not specify how the tax relief will be provided or what forms it might take.

Official Summary Text

After
property
taxes become delinquent,
present law requires
the county trustee
to
collect the taxes
from the property owner. If a lien is properly placed on the property through the judicial system, t
he court
must
order a sale o
f the land for cash, certified funds, cashier's check, money order, or automated clearing house transfer, as applicable.

The tax sale proceeds must be distributed
in the
following
order
:

(
1
) Amounts owing the delinquent tax attorneys prosecuting the ca
use
.

(
2
) The costs of the proceeding exceeding the attorneys' fees
.

(
3
) Amounts owing the taxing entities which are parties in the cause
.

(
4
) Amounts owing to tax entities filing a claim for current and other delinquent taxes and interest due them
as stated in claims filed in response to
the
notices sent
to
them and for which no action has been filed, divided prorated upon the amount of the base taxes due each
.

(
5
) Any other property taxes and expenses owing any taxing entity secured by a tax li
en on the parcel
.

(
6
) Any remaining proceeds
to any
interested person
that
file
s
a motion with the court requesting disbursement of any excess sale proceeds
, subject to certain priority order.

This bill adds a new fourth priority distribution and shifts down the current fourth, fifth and sixth priorities above. The new fourth priority is that
10% of any remaining proceeds
must
provid
e
tax relief for homeowners who are elderly low-income, disabl
ed, or a disabled veteran or widow of a disabled veteran
.

Current Bill Text

HOUSE BILL 765
By Wright

SENATE BILL 775
By Briggs

SB0775
002351
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 67,
Chapter 5, relative to delinquent taxes.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 67-5-2501(a)(3)(A), is amended by
adding the following as a new subdivision (vi) and redesignating the existing subdivision (vi):
(vi) Ten percent (10%) of any remaining proceeds to be used to providing tax
relief for the homeowners who are elderly low-income, disabled, or a disabled veteran or
widow of a disabled veteran, pursuant to part 7 of this chapter; then
SECTION 2. This act takes effect July 1, 2025, the public welfare requiring it.