|What is Business Personal Property?
+ BASIC OVERVIEW
All tangible property, unless exemption is provided for by the Utah Constitution and enacted by the legislature, is valued and assessed annually by the Personal Property Division of the Assessor’s Office and is therefore taxable. Such tax is levied against all personal property assets (i.e. trade fixtures, equipment, computers, telephone systems, furniture, tools, etc.) owned by the “business” as of January 1st of each year.
All businesses are required to declare their taxable property to the Assessor annually by way of a self-assessing statement. New businesses should register with the Assessor when taking out a business license to avoid assessment of escaped property taxes. The personal property tax is collected and apportioned to the county, cities, school districts, and other taxing entities to pay for local governmental services.
+ VALUATION METHODOLOGY
Utah Code in Title 59 requires the taxation of property for the funding of local government and Utah schools. Property tax is assessed on both real property and personal property. Generally, personal property used in a business is subject to property taxes. Utah law requires business personal property to be reported to the county assessor where the property is located (has situs) on a tax form identified as a Personal Property Signed Statement. Personal Property is taxed based on its taxable value as of January 1 of each year. In order to value personal property, the Utah State Tax Commission provides personal property classification schedules which are used by all county assessors in Utah.
Personal Property is valued using a classification system referred to as “Recommended Personal Property Valuation Schedules”. These schedules identify various types of personal property and provide a “percent good” of acquisition cost for commercial personal property. These valuation schedules provide a factor to be applied to acquisition cost (refer to the Definition of Acquisition Cost below) and acquisition year to determine taxable value. Once taxable value is determined, the local tax rate is applied to calculate the tax due.
+ PERSONAL PROPERTY LEGISLATIVE CODE
Tangible Personal Property Exemption-(Utah Code 59-2-1115 (2)(a)) “The taxable tangible personal property of a taxpayer is exempt from taxation if the taxable tangible personal property has a total aggregate taxable value per county of $10,000 or less.”
Personal Property Filing Deadline-(Utah Code 59-2-306(2)(a)) A signed statement "shall be filed on or before May 15 of the year statement ... is requested by the county assessor."
For 2014, a business with an aggregate taxable value of $10,000 or less may be exempt from personal property tax. This exemption applies to the total value of all Personal Property owned and/or used by the business in Weber County. If you have more than one business location in Weber County under the same business ownership, the exemption is applicable only if the total value of all property owned by such entity is less than $10,000. To qualify for this exemption, you must still file. (Utah Code 59-2-1115 (2)(a)) “The taxable tangible personal property of a taxpayer is exempt from taxation if the taxable tangible personal property has a total aggregate taxable value per county of $10,000 or less.”
Property owned and used exclusively by a non-profit religious, charitable, or educational institution may be exempted upon application and approval by the Weber County Board of Equalization. Until the exemption is approved by the board, the entity is deemed taxable.
A penalty of $25 or 10% of the estimated tax due, whichever is greater, is assessed when a taxpayer fails to file a statement of personal property on or before May 15, 2014. Property willfully concealed, misrepresented, or moved, in order to escape taxation is subject to a penalty equal to the tax on its value.
(Utah Code 52-2-307) "Each person who fails to file the signed statement required by section 59-2-306 ... shall pay a penalty equal to 10% of the estimated tax due but not less than $25 for each failure to file a signed and complete statement."
(Utah Code 52-2-307(2)(b) "The penalty under Subsection (1)(a) ... may not be imposed until 30 days after the postmark date of mailing of a subsequent notice." That subsequent notice will be mailed in a timely manner prior to the filing deadline of May 15, 2014 ... therefore the late filing penalty will be "applied to all accounts that have not filed by May 15, 2014. The penalty is not appealable."
Accounts not satisfied by May 15, 2014 will be subject to interest at the rate of 7.00% annually.
+ NON-CAPITALIZED PERSONAL PROPERTY
(UTAH CODE ANN. 59-2-108)
Class 28: Non-Capitalized Personal Property: Non Capitalized Personal Property is an item of machinery, equipment, furniture, computers, or any other tangible personal property that the acquisition cost has been totally expensed or written off in the year of acquisition. Any item of personal property whose acquisition cost is or has been depreciated using MACRS, Straight Line, or ACRS over several years for federal tax purpose does not qualify as being treated as Non-Capitalized Personal Property (Class 28)
"Non Capitalized Personal Property" is an item of personal property that meets the following criteria:
Any Taxpayer dissatisfied with the taxable value may appeal by filing an application no later than May 15, 2014. Appeal forms may be obtained from the Weber County Auditor's office, 2380 Wash. Blvd. STE 320 Ogden, Utah 84401. Appeal must be received no later than May 15, 2014.
In order to insure compliance with the self-assessing program, random and/or referred audits may be performed by the assessor. The audit section of the personal property division performs detailed reviews of financial records and on-site inspections of taxpayers' facilities and compares those results to the statements submitted by the taxpayer. Escaped property, when discovered, may be assessed as far back as five years from the date of discovery. Property willfully concealed, misrepresented, or moved, in order to escape taxation is subject to a penalty equal to the tax on its value.
Cost of Acquisition must include all costs required to put an item into service. In addition to the cost of the item, include the following costs:
Freight in, includes shipping costs, loading at origin, unloading at destination, crating, skidding, and other applicable costs of shipping.
Installation, engineering, rigging, erection or assembly to include foundations, pilings, utility connections and any other costs related to installation.
Excise and sales taxes.
Any other costs related to putting personal property into service are to be included in acquisition cost.
Indirect costs such as debugging, licensing fees, permits, insurance or security are not included in acquisition cost.
Percent Good Schedule
Undervalued or omitted from the tax rolls because of the failure of the taxpayer to comply with the reporting requirements of this chapter; or
Undervalued because of errors made by the assessing authority based upon incomplete or erroneous information furnished by the taxpayer.
Property which is undervalued because of the use of a different valuation methodology or because of a different application of the same valuation methodology is not "escaped property."
Property Willfully Concealed
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