An Overview of Personal Property Taxes
Personal property taxes are not the same as property taxes, which cover real estate and land. Property taxes are due in every state. However, paying personal property taxes are only required in certain states. One must check with their state tax rules so they can know exactly what will be taxed. Every state has different guidelines that they follow.
Some states may require one to pay a personal property tax on things that another state does not. Personal property taxes are paid in addition to, not instead of property taxes. Many states require businesses to pay personal property taxes. In order to find out the value of the personal property, the personal property is inspected by a county assessor.
The county assessor calculates a percentage of the true value of the object. The true value of an object is calculated by determining the amount of money that an average person would pay for the item.
Background:
Personal property does not mean every object in someone's home or office. One thing that is almost always considered personal property is vehicles. Almost no vehicle is exempt from being taxed if one must pay personal property taxes.
Everything from cars to boats to aircrafts are are considered personal property. In fact, vehicles in particular are known for being heavily taxed if one's state requires personal property tax payment. Certain valuable items like paintings may be taxable as personal property. The rules of what constitutes personal property differs when it comes to businesses.
Exemptions:
There are many things that are exempt from being taxed as personal property. Regular household items, except when also used for business, are not taxable even if one does have to pay personal property taxes. Businesses have fewer exemptions.
Almost all of their things, including office furniture is not exempt from personal property taxes. However, businesses do have one special exception that does not apply to any other vehicle. If a business has a vehicle that was made or used primarily for traveling on highways or public streets, it is exempt from personal property tax payments.
Taxes on Destroyed Property:
Destroyed property loses both property and personal property value. If an individual's property is destroyed, they must file a claim with their assessor and have the property reassessed.
The assessor decides what the new value is. While there is only a certain amount of time one has to make file the claim, there is a very strong chance that their property and personal property taxes will be lowered. This is true even if the property was only partially destroyed. It is important to remember that if one gets their property rebuilt during the year, they must notify the county. The county will then send an assessor to reassess the property and decide on the new property and personal property taxes.
Penalties:
Serious penalties may be imposed on an individuals who fail to pay their required property and personal property taxes. There are also tax penalties for individuals who do not file a claim for their personal property each year. While some of the penalties may be mild, such as small interest rate increases, others are much more serious.
One might even be subject to having their property and personal property seized. The county may then have option of selling it or using it for whatever purpose they choose. One should stay organized, file necessary paperwork on time and make all tax payments quickly.
