Microsoft Word - APRIL 15TH BUSINESS PERSONAL PROPERTY TAX IN TEXAS.doc

Grayson Central Appraiasl District | 512 N. Travis Sherman, TX 75090

Business Personal Property Tax

in Texas



Most people know that property tax applies to real property. However, some people may not be

aware that property tax also applies to personal property unless specifically exempt by law. Real and

personal property are defined differently. The characteristic that distinguishes personal property

from real property is mobility. Personal property tax rates are the same as those for real property.

In general, real property includes land, improvements to land, structures and certain equipment

affixed to structures. Per Section 22.01(a) of the Texas Property Tax Code, taxable personal property

includes assets used for the production of income, such as inventories, machinery, equipment,

vehicles, furniture and supplies used in the business.

Renditions: Business owners are required to file an annual report (or rendition) of all taxable

personal property located in the county as of January 1 of the current year. As a courtesy, the

Appraisal District mails a rendition form each year. If not received one can be obtained from

graysonappraisal.org or comptroller.texas.gov (Form 50-144). Thecompletedformisduenolater

thanApril15

. Owners can render either a good faith estimate of market value or a list of business

assets, with each asset acquisition cost and year acquired, or both. The chief appraiser can require

documentation to support a good faith estimate of market value. A detailed list of assets with cost

and year acquired can be used as documentation. The appraiser determines the value for assessment

purposes based on this information, as well as on observations made during on-site inspections of

the business. If a business owner neglects to file an annual rendition with the Appraisal District,

accepted appraisal procedures will be utilized to place a value on the property.

Failuretorender,

orthesubmissionofalaterenditionwithout awrittenfilingextensionrequestwill

resultinapenaltyequalto10%ofthetotaltaxesdue.Filingareportwiththeintentto

commitfraudorevadetaxeswillresultinapenaltyequalto50%ofthetotaltaxesdue.

 Ifadetailedlistofassetsisrendered,therenditionshould:

 Identify each taxable category. For example, office furniture and equipment must be

separately identified as computers, desks, facsimile machines, copiers, etc. and include the

year in which each item was acquired.

 Include the total purchase cost of each item. The total purchase cost of an item includes all

costs associated with making the property operational. For example, installation, freight and

engineering charges are costs that may be incurred while placing property into operation.

The value of any trade-in is to be included as part of the total purchase cost.

 Include all supplies on hand as of January 1. This includes office, retail and manufacturing

supplies (computer paper, cash register tapes, shipping cartons, etc).

 Include the cost of inventory on hand as of January 1. The total cost of inventory is the

amount the business owner paid to acquire the goods, including freight and handling

expenses, minus any discounts or returns.

Thepropertyownermustcomplete,signandreturntherenditionformtotheAppraisal

DistrictnolaterthanApril15

,unlessawrittenextensionrequesthasbeenapproved.