Many states still subject business tangible personal property to a property or ad valorem tax just like real estate. The problem is the tangible personal property is self-reported by the taxpayer (subject to audit) whereas the real estate is assessed independently by a local government assessor. As might be expected, certain assets like leasehold improvements, overhead cranes, machinery foundations, process piping/plumbing, tanks/vats, electrical work, etc. are often double counted and double taxed as both real and personal property.
Another problem with personal property taxes are "ghost assets." Ghost assets are depreciable assets that have long been disposed of, abandoned, or rebuilt/refurbished but never relieved from the cost of fixed assets, usually because they are fully depreciated and simply carried on the books at a zero net book value. But for property tax purposes, these assets continue to be taxed unless or until they are property deleted from the taxing jurisdiction's assessment rolls.
Our FGMK SALT specialists know how to fix this along with claiming the available exemptions and reductions to which you are entitled.
Here are some of the personal property tax areas FGMK's SALT specialists can help you with:
- Personal property tax preparation and review
- "Ghost asset" elimination of sold, disposed of, or abandoned property
- Elimination of intangible property embedded with tangible property
- Exemption recovery e.g. pollution control equipment, inventory freeport exemptions
- Depreciation & asset classification services e.g. use of higher depreciation percentages, lower class lives, later placed-in-service dates
- Reduced rates for functional & economic obsolescence, idle equipment, construction-in-progress, special tooling & fixturing
- Elimination of leasehold improvements double taxed as both real & personal property
- Property tax audits & appeals