§ 105-277.1D. (Effective for taxes imposed for taxable years beginning on or after July 1, 2010. See note for repeal.) Inventory property tax deferral. - North Carolina Statutes

§ 105‑277.1D. (Effective for taxes imposed for taxable years beginning on or after July 1,2010. See note for repeal.) Inventory property tax deferral.

(a)        Classification. – Aresidence owned and constructed by a builder is designated a special class of propertyunder Section 2(2) of Article V of the North Carolina Constitution and istaxable in accordance with this section. For purposes of this section, a"residence" is an improvement, other than remodeling, renovating,rehabilitating, or refinishing, by a builder to real property that is intendedto be sold and used as an individual's residence, that is unoccupied, and forwhich a certificate of occupancy authorized by law has been issued.

(b)        Deferred Taxes. – Abuilder may defer the portion of tax imposed on real property that representsthe increase in value of the property attributable solely to improvementsresulting from the construction by the builder of a residence on the property.The difference between the taxes due under this section and the taxes thatwould have been payable in the absence of this section are a lien on the realproperty of the taxpayer as provided in G.S. 105‑355(a). The differencein taxes for the fiscal years preceding the current tax year shall be carriedforward in the records of the taxing unit or units as deferred taxes. Thedeferred taxes are due and payable in accordance with G.S. 105‑277.1Fwhen the property loses its eligibility for deferral because of the occurrenceof a disqualifying event. A disqualifying event occurs at the earliest of (i)when the builder transfers the residence, (ii) when the residence is occupiedby the builder or by someone other than the builder with the builder's consent,(iii) five years from the time the improved property was first subject to beinglisted for taxation by the builder, or (iv) three years from the time theimproved property first received the property tax benefit provided by thissection. On or before September 1 of each year, the collector shall notify eachbuilder to whom a tax deferral has previously been granted of the accumulatedsum of deferred taxes and interest.

(c)        CreditorLimitations. – A mortgagee or trustee that elects to pay any tax deferred bythe builder subject to a mortgage or deed of trust does not acquire a right toforeclose as a result of the election. Except for requirements dictated byfederal law or regulation, any provision in a mortgage, deed of trust, or otheragreement that prohibits the builder from deferring taxes on property underthis section is void.

(d)        Construction. – Thissection does not affect the attachment of a lien for personal property taxesagainst a tax‑deferred residence.

(e)        Application. – Anapplication for property tax relief provided by this section should be filedduring the regular listing period but may be filed after the regular listingperiod upon a showing of good cause by the applicant for failure to make atimely application, as determined and approved by the board of equalization andreview or, if that board is not in session, by the board of countycommissioners. An untimely application approved under this subsection appliesonly to property taxes levied by the county or municipality in the calendaryear in which the untimely application is filed. Decisions of the county boardmay be appealed to the Property Tax Commission. Persons may apply for thisproperty tax relief by entering the appropriate information on a form madeavailable by the assessor under G.S. 105‑282.1.  (2009‑308, s. 2.)