TCA § 67-4-2022 — Taxes collected from cemetery companies

This section does not create or impose a new tax, but shall govern allocation of taxes already collected under this part from cemetery companies as defined in § 46-1-102 . These taxes shall be allocated as follows: To cities and counties, an amount for each company with an office in this state as determined in this subdivision (1). Three percent (3%) of the net earnings of the company less seven percent (7%) of the ad valorem taxes paid by the company on its real and tangible personal property for the second fiscal year preceding the year in which the distribution is made. For purposes of this subdivision (1), “net earnings” does not include amounts attributable to interest earned on bonds and other obligations of this state. The total amount thus determined shall be allocated between the county and municipal governments where the office of the company is located in the same proportion as the property tax rate of each such taxing jurisdiction shall bear to the sum of the property tax rates; In circumstances where a company has more than one (1) office, the total allocation attributable to such company as determined in subdivision (1)(A) shall be further allocated between such counties and cities where its offices are located as follows: The proportionate percentage that is produced by the ratio of assessed value for ad valorem tax of real and tangible personal property associated with each office of the company, to the total assessed value for all offices of the company shall be determined as of January 1 of each year, and the percentage so determined shall then be applied to the total allocation to determine the portion of the total attributable to each office; The offices shall then be grouped each to a common location so as to determine the aggregate allocation of all offices located in each individual county and municipality; and The percentage of the total allocation allowable to each county and municipality shall be divided between the county and municipality where the office is maintained in the same proportion as the property tax rates of each for the second year preceding the year in which the distribution under this section is made shall bear to the total of the property tax rates. The director of the division of property assessments shall provide to the commissioner, periodically on a timely basis, the ad valorem property tax rates for each taxing jurisdiction. The commissioner shall report the amount of such allocations made to each county and municipality to the comptroller of the treasury for audit purposes on an annual basis. The status of each cemetery company as of January 1 of the fiscal year for which the allocation is calculated shall be the determining basis. If the net earnings of any cemetery company shall be redetermined for any period in accordance with this part, the commissioner shall recalculate the allocation attributable to the company, and any indicated increase or decrease in allocation shall be effected in the next succeeding general allocation to the respective county and municipal governments, as appropriate. The commissioner and the county assessors of property shall exchange such information as will enable the department to ascertain the correctness of the allocation. After allocation to counties and municipalities as provided in subdivision (1), the remainder of the taxes collected under this part shall be applied to and become a part of the general fund of the state. Acts 2011, ch. 438, § 5. Compiler's Notes. Acts 2011, ch. 438, § 2 provided that it is the intent of the general assembly by the act to exercise its discretion granted in the Tennessee Constitution, Art. II, § 28, to establish the manner in which intangible personal property of financial institutions other than banks and insurance companies, and intangible personal property of cemetery companies formerly assessed under title 67, chapter 5, part 11, is assessed and taxed. The allocation of taxes to local governments provided in the act shall be in lieu of the taxation of the subclassification of intangible personal property designated as “shares of stock of stockholders of any loan company, or investment company, or cemetery company” and in lieu of all taxes on the redeemable or cash value of all their outstanding shares of capital stock, loans, accounts or certificates of investment, by whatever name called; provided, that such companies shall nonetheless continue to be subject to ad valorem taxes on their real and tangible personal property and shall continue to be subject to all other taxes (other than the tax deleted in title 67, chatper 5, part 11) to which they are currently subject. Acts 2011, ch. 438, § 6 provided that the allocation of excise taxes to counties and cities provided in §§ 67-4-2020 — 67-4-2022 shall be limited to one million dollars ($1,000,000) for 2011, and distribution shall not be made before July 1, 2012. If total sharing is diminished for any county as the result of this cap, counties with certified 2010 assessments pursuant to itle 67, chapter 5, part 11 will share first up to the amount of property tax billed on the 2010 assessments, and the remaining counties shall share the balance in proportion to their share in the original allocation. Acts 2011, ch. 438, § 7 provided that the act shall not affect rights or duties that matured, liabilities or penalties that were incurred, or proceedings begun before their effective date, except as otherwise therein specifically provided. Acts 2011, ch. 438, § 8 provided that if any provision of the act or the application thereof to any person or circumstance is held invalid on the basis that the legislature has not properly exercised its authority, then all provisions and applications of the act are declared to be invalid and void. Acts 2011, ch. 438, § 9 provided that the act shall apply both to assessments made under title 67, chapter 5, part 11, and to collections received under title 67, chapter 4, part 20, on and after January 1, 2011. Law Reviews. Taxation-State Tax Apportionment of Out-Of-State Business Income—Constitutionality and Propriety of a State's Apportionment and Taxation of Capital Gains as Business Earnings (Clark Milner), 79 Tenn. L. Rev. 437 (2012).