New statewide legislation in Tennessee requires that a taxpayer must at least pay the undisputed portion of the taxes on the property prior to a hearing on appeal. Actually, it is required that the undisputed portion be paid prior to the delinquency date. This applies to all boards of equalization, both state and local.

The penalty for this is harsh resulting in the taxpayer’s appeal being dismissed.

Our attorneys tell us there may be an exception in Shelby County, but this is something that should not be relied upon.

The State Board of Equalization used to apply the dismissal rule before there was any legislation on this matter. To counter this, our firm drafted legislation and passed an exception for Shelby County. The legislation provided that a taxpayer’s appeal would not be dismissed if the taxpayer had not paid the undisputed portion, but the taxpayer would be refused a hearing until the taxes were paid. This is a far less severe penalty.

The exception statute for Shelby County is still there. However, at least one administrative judge for the State Board of Equalization has ignored the statute and dismissed a case in Shelby County because the taxes were not paid prior to the hearing.

Therefore, the safer route would be to pay the undisputed portion before the hearing. Also, keep in mind that no delinquent taxes can be outstanding on the property or the taxpayer will suffer the same dismissal penalty.