If a Mississippi county made an error and overcharged me on property taxes for ten years, can the county refund all ten years?

Plain-English summary

A homeowner in DeSoto County had a homestead exemption since 2002. In 2012, when the homeowner changed mailing addresses, the county erroneously deleted the homestead exemption. The homeowner never moved out of the property, just changed where bills were sent. For ten years, the county overcharged the homeowner because the exemption had been removed in error.

When the homeowner turned 65 in 2022 and applied for the over-65 exemption, the original error finally surfaced. DeSoto County asked the AG: can we refund all ten years of overpayment, since the entire error was the county's fault?

The AG said no. Mississippi has two layers of rules:

1. The county on its own motion cannot grant tax refunds. The mechanism is statutory: the tax collector issues the refund, after the board of supervisors makes a factual finding (spread on its minutes) that the taxpayer is entitled to it.

2. There is a three-year cap. Even though Section 27-73-7 (the refund statute for erroneously paid property taxes) does not contain its own limitations period, the Mississippi Supreme Court in Rankin County Board of Supervisors v. Lakeland Income Properties held that the general three-year statute of limitations in Section 15-1-49 applies. So the homeowner can recover three years of overpayment, not ten.

The result is harsh on the homeowner here, since the error was entirely the county's, but the AG's job is to apply the statute as the courts have read it.

What this means for you

If you discover an error on your property tax bill

Move fast. The three-year clock runs from when the tax was paid. Each year you delay raising the issue is a year of refund that disappears off the back end. Specifically:

• File a written petition or application with the county tax collector explaining the error and requesting a refund.
• Ask the board of supervisors (through the tax collector or chancery clerk) to put the matter on its agenda for a factual finding.
• Bring documentation: deeds, prior homestead applications, prior tax bills showing the exemption, mailing-address change records, anything that shows the error was an error.

If your error spans more than three years, you can still recover the most recent three years. The earlier years are forfeited.

If you're a homeowner who turns 65

Use the over-65 application as an audit moment. Pull every tax bill back as far as you have records and check the homestead exemption status. Address changes, marriage, divorce, transfer to a trust, all of these are common triggers for accidental homestead deletions. If you find an error, file the refund petition immediately. Do not wait until you have a complete history.

If you're a county tax collector

Section 27-73-7 gives you authority and obligation to refund. But you cannot do it unilaterally. The procedure:

1. Receive the petition or application from the taxpayer.
2. Bring it to the board of supervisors with documentation.
3. The board makes a factual finding by order on its minutes that the taxpayer is entitled to the refund.
4. The refund is issued for up to three years preceding the petition. Earlier years are barred.

Do not let well-meaning sympathy tempt you into approving older years. The Supreme Court has spoken on this. Beyond three years is unauthorized expenditure of public funds.

If you're a county board of supervisors

You cannot refund taxes on the board's own motion. The county must act in response to a taxpayer petition. And your factual finding must be specific: it identifies the taxpayer, the years involved, the basis of the error, and the amount. Vague or blanket refund orders create state-auditor problems.

If you're a state auditor field examiner

Refund orders that go beyond three years are red flags. Under Rankin County and § 15-1-49, those are unauthorized. So are refund orders issued without a board's factual finding on the minutes.

Common questions

Q: How long is the statute of limitations on property tax refunds?
A: Three years. Although § 27-73-7 itself does not say so, § 15-1-49(1) supplies the general three-year limitation, and the Mississippi Supreme Court has held in Rankin County Board of Supervisors v. Lakeland Income Properties, 241 So. 3d 1279 (Miss. 2018), that this period applies to ad valorem property tax refunds.

Q: Does the three-year clock run from the year the tax was for, or the year I paid?
A: From when the tax was paid. The opinion frames the recovery as for "erroneously paid taxes."

Q: Can the board of supervisors initiate a refund without my asking?
A: No. The opinion is explicit: a county on its own motion may not refund. The mechanism requires a taxpayer petition or application and a board finding.

Q: What kinds of taxes does § 27-73-7 cover?
A: Section 27-73-7 expressly covers ad valorem, privilege, and excise taxes. The refund authority is broad but the three-year cap applies.

Q: I overpaid because of a double payment, not an exemption error. Same rules?
A: Same statute. Section 27-73-7 specifically lists "double payment, or overpayment, or payment on state, United States, vacant and exempt land" among the kinds of erroneously paid taxes covered. The three-year cap still applies.

Q: What if I sue the county instead of going through the refund process?
A: The same three-year limitations period from § 15-1-49 caps a lawsuit. Going to court does not buy more time.

Background and statutory framework

Mississippi handles tax refunds in two layers. Section 27-73-5 sets a three-year limitations period for refund actions on privilege, income, and excise taxes specifically. Notably, that section says nothing about ad valorem (property) taxes, which created an uncertainty: did property tax refunds have any limitations period at all?

The AG and the Mississippi Supreme Court resolved that uncertainty by reaching for § 15-1-49, the general "catch-all" three-year statute of limitations. In Rankin County Board of Supervisors v. Lakeland Income Properties, 241 So. 3d at 1292, the Court "agreed that for ad valorem taxes, 'the refund potential of Section 27-73-7 is limited by the statute of limitations enumerated in Section 15-1-49.'"

That answers the legal question, but not the equitable one. When the county itself made the error and overcharged a property owner for ten years, applying a three-year cap means the homeowner pays for the county's mistake. The AG cannot rewrite that result. A homeowner with this kind of long-running error may want to consult a real estate attorney about claims that might exist outside the property-tax refund framework, though the practical recovery is likely still limited.

Citations and references

Statutes:
- Miss. Code Ann. § 15-1-49 (general three-year statute of limitations)
- Miss. Code Ann. § 15-1-49(1)
- Miss. Code Ann. § 27-73-5 (three-year limit for privilege, income, excise tax refunds)
- Miss. Code Ann. § 27-73-7 (tax collector refund authority)

Case:
- Rankin County Board of Supervisors v. Lakeland Income Properties, LLC, 241 So. 3d 1279, 1292 (Miss. 2018), confirming three-year limit for ad valorem tax refunds

Prior AG opinions referenced:
- MS AG Op., Nowak (Apr. 27, 2007)
- MS AG Op., Nowak (July 28, 2017)
- MS AG Op., Myers (Feb. 20, 1998)

Source

• Landing page: https://attorneygenerallynnfitch.com/divisions/opinions-and-policy/recent-opinions/
• Original PDF: https://attorneygenerallynnfitch.com/wp-content/uploads/2023/03/A.Nowak-March-13-2023-Tax-Refund-for-Erroneously-Paid-Property-Taxes.pdf

Original opinion text

March 13, 2023

Anthony E. Nowak, Esq.
Attorney, DeSoto County Board of Supervisors
Post Office Box 346
Hernando, Mississippi 38632

Re: Tax Refund for Erroneously Paid Property Taxes

Dear Mr. Nowak:

The Office of the Attorney General has received your request for an official opinion.

Background

According to your request, a property owner acquired title to property in 2001 and filed for homestead exemption in 2002. The homestead exemption was approved, and the homestead exemption remained in place until 2012 when the homestead exemption was deleted due to a change in the owner's mailing address. However, the property owner never vacated the property; there was simply a change in the mailing address. In 2022, the property owner turned 65 and applied for the over-65 homestead exemption, at which time the erroneous homestead deletion was noticed. As a result of DeSoto County's error, the taxpayer was assessed and paid substantially more in property taxes than should have been paid for a period of 10 years. The error was solely the result of an erroneous assessment and not the result of any mistake on behalf of the landowner.

Question Presented

May DeSoto County, on its own motion, or the county tax collector refund erroneously paid taxes for a period of time that looks back more than three years?

Brief Response

DeSoto County, on its own motion, may not refund erroneously paid taxes. The tax collector, pursuant to Mississippi Code Annotated Section 27-73-7, may refund erroneously paid property taxes. Any claim for the refund of erroneously paid taxes, however, is subject to a three-year statute of limitation.

Applicable Law and Discussion

Mississippi Code Annotated Section 27-73-7 provides, in pertinent part:

The tax collector is authorized and empowered to refund any individual, firm or corporation any ad valorem, privilege or excise tax which has been paid or collected through error or otherwise when such person, individual, firm or corporation has paid any such tax in excess of the sum properly due whether paid under protest or not. Taxes erroneously paid within the meaning of this section shall include, but not be limited to, double payment, or overpayment, or payment on state, United States, vacant and exempt land, and the purchase paid for the redemption of lands erroneously sold for taxes.

This office has previously opined that a tax collector, upon order from the board of supervisors, may refund taxes paid in error. MS AG Op., Nowak at 1 (Apr. 27, 2007); MS AG Op., Myers at 1 (Feb. 20, 1998). Section 27-73-5 sets a three-year limitation period for all suits, applications, and proceedings by taxpayers for the recovery and refund of privilege, income, and excise taxes but does not speak to ad valorem taxes. Nonetheless, this office and the Mississippi Supreme Court have opined that the general three-year statute of limitation in Section 15-1-49 applies to the potential refund set forth in Section 27-73-7, which includes ad valorem taxes. MS AG Op., Nowak at 2 (July 28, 2017) ("[C]laims for erroneous tax payments, except those enumerated in Section 27-73-5, are subject to . . . Section 15-1-49(1), which [also] provides for a three-year time limitation."); Rankin Cnty. Bd. of Supervisors v. Lakeland Income Props., LLC*, 241 So. 3d 1279, 1292 (Miss. 2018) (agreeing that for ad valorem taxes, "the refund potential of Section 27-73-7 is limited by the statute of limitations enumerated in Section 15-1-49.")

Upon petition or application by the taxpayer, the tax collector may issue a refund after the board of supervisors "make[s] a factual finding by order on the minutes that the taxpayer was entitled to the refund . . . ." Nowak at *2 (July 28, 2017). The refund is limited to three years. Id.

If this office may be of any further assistance to you, please do not hesitate to contact us.

Sincerely,

LYNN FITCH, ATTORNEY GENERAL

By: /s/ Gregory Alston
Gregory Alston
Special Assistant Attorney General