La. Revenue and Taxation § 47:2323

Current with changes from the 2024 Legislative Session

Section 47:2323 - Criteria for determining fair market value; real and personal property; unoccupied residential immovable property

A. The criteria for determining fair market value shall apply uniformly throughout the state. Uniform guidelines, procedures and rules and regulations as are necessary to implement said criteria shall be adopted by the Louisiana Tax Commission only after public hearings held pursuant to the Administrative Procedure Act.

B. Each assessor shall follow the uniform guidelines, procedures, and rules and regulations in determining the fair market value of all property subject to taxation within his respective parish or district. Any manual or manuals used by an assessor shall be subject to approval by the Louisiana Tax Commission or its successor agency.

C. Criteria.

The fair market value of real and personal property shall be determined by the following generally recognized appraisal procedures: the market approach, the cost approach, and/or the income approach.

(1) In utilizing the market approach, the assessor shall use an appraisal technique in which the market value estimate is predicated upon prices paid in actual market transactions and current listings.

(2) In utilizing the cost approach, the assessor shall use a method in which the value of a property is derived by estimating the replacement or reproduction cost of the improvements; deducting therefrom the estimated depreciation; and then adding the market value of the land, if any.

(3) In utilizing the income approach, the assessor shall use an appraisal technique in which the anticipated net income is capitalized to indicate the capital amount of the investment which produces the net income.

D. When performing a valuation of unoccupied residential immovable property held for sale by a juridical person prior to the initial occupancy of such property, the assessor may when considering the income approach to value consider factors such as the estimated sales price of the unoccupied immovable property, the estimated holding period needed to sell the property, expenses, including expenses incurred during the holding period, and the capitalization rate which includes the economic risks associated with the holding period. For purposes of this Section, the initial occupancy shall mean the first occupancy of the property by a natural person, as well as occupancy by a natural person after substantial modification has been made to the property.

E. When performing a valuation of any affordable rental housing property, the assessor shall not consider any of the following in determining fair market value:

(1) Income tax credits available to the property under Section 42 of the Internal Revenue Code.

(2) Below-market interest rate on financing obtained under the Home Investment Partnership Program under the Cranston-Gonzales National Affordable Housing Act, or the Federal Home Loan Bank Affordable Housing Program established pursuant to the Financial Institution Reform, Recovery, and Enforcement Act of 1989.

(3) Any other federal, state, or similar program intended to provide or finance affordable rental housing to persons of low or moderate income and requiring restricted occupancy and rental rates based on the income of the persons occupying such housing.

La. Revenue and Taxation § 47:2323

Added by Acts 1976, No. 705, §3, eff. Aug. 4, 1976; H.C.R. No. 88, 1993 R.S., eff. May 30, 1993; H.C.R. No. 1, 1994 R.S., eff. May 11, 1994; Acts 2010, No. 1044, §1; Acts 2016, No. 182, §1, eff. Jan. 1, 2017.

Amended by Acts 2016, No. 182,s. 1, eff. 1/1/2017.

Added by Acts 1976, No. 705, §3, eff. 8/4/1976; H.C.R. No. 88, 1993 R.S., eff. 5/30/1993; H.C.R. No. 1, 1994 R.S., eff. 5/11/1994; Acts 2010, No. 1044, §1.