Businesses - Frequently Asked Questions
Business Tangible Personal Property |
What is business tangible personal property?
It is any furniture, fixtures, tools, or equipment that is used or available for use in a business. It includes fixed assets, but does not include supplies (such as pens and paper) or real estate. For a more detailed list of applicable assets, see Sections One and Two of the BPP return form.
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What is the due date for the business tangible personal property tax return?
March 2
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Can I get an extension of time to file the return?
Yes, but your request must come in writing and be faxed or postmarked by March 2. An extension will be granted for no longer than 60 days.
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What is the tax rate?
The current tax rate is $3.60 per $100 of assessed value (that is, 3.6% of the value). The rate is set each year by the board of supervisors.
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What if I went out of business?
You must notify our office in writing that you went out of business. If your BPP is on commercial property and is still available for use in business after you went out of business, you are responsible to continue to report it until it is removed or made unavailable for use in the business. Note that BPP is NOT pro-rated.
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What if I purchased or recapitalized an item on January 1?
Report the item on the form and use a 90% assessment factor. Include a note on the “Total” line that these assets are included there.
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What if I am a sole proprietor and I own the equipment personally?
You must still report any tangible equipment that is used or available for use in your business.
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What if I own no equipment?
Then you must write “None” on the return and still send it in, along with an explanation of owning no equipment. You are required to file the return no matter how much equipment you have. If you lease equipment, then report it in Section Three of the return.You may be asked to provide a copy of the lease agreement.
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Do you allow for technological obsolescence?
Yes, for certain computer equipment and peripherals, as described in Section Two of the return. Computers and peripherals are assessed using a more progressive schedule of assessment factors, found in Section Two. Please note that “computerized” equipment is not the same as a computer or peripheral and would usually be reported along with all other equipment (in Section One), not with computer equipment in Section Two.
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What if I do not depreciate anything?
You must still file the form and report all equipment used or available for use in the business. You must include an itemized list of all equipment; and you may be asked to provide a copy of your federal Schedule C or Form 1120 in lieu of the required copy of your federal depreciation schedule.
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What do I need to attach to my form?
An itemized list of all property reported, and a copy of your most recent federal depreciation schedule (Form 4562), if you filed one. If you did not file a federal depreciation schedule, you may be asked to provide other supporting documents, including federal Schedule C or Form 1120 in lieu of the Form 4562
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Machinery and Tools (M&T) Tax |
How do you determine who is a manufacturer or processor?
This is a determination made by the commissioner, based on a number of facts about the process and nature of your business activities. Taxpayers must first submit the “BCI” Form , with relevant documentation such as photos, process flow charts, or narratives for review. In some cases a site visit is necessary by our auditors. The nature and extent of any transformation during your process is most important in making this determination.
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Can I get an extension of time to file my return?
Yes, but your request must come in writing and be faxed or postmarked by March 2. An extension will be granted for no longer than 60 days.
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What if I went out of business?
You must notify our office in writing that you went out of business. If your M&T is on commercial property and is still available for use in business after you went out of business, you are responsible to continue to report it until it is removed or made unavailable for use in the business. Note that M&T tax is NOT pro-rated.
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What about idle and unused equipment?
Machinery and tools may be reported as “Idle and Unused” if they (a) have been discontinued in use continuously for at least one year prior to January 1, 2009 or (b) on and after January 1, 2008, have been specifically identified in writing by the taxpayer to the commissioner of the revenue on or before April 1, 2008, that the machinery and tools would be withdrawn from service before January 1, 2009, not in use on January 1, 2009, and no reasonable prospect exists that the machinery and tools will be returned to use prior to January 1, 2010. Construction-in-progress, occasional, and seasonal use of machinery and tools would not constitute “idle and unused” property.
A detailed list of assets itemizing all property reported by capitalized cost and date of acquisition must be submitted with this return. Also, an explanation must be provided with this return if there is a difference between the property reported on this return and your 2008 return. This asset list should include a separate list of assets that were idle and unused continuously for one year prior to January 1, 2009.
You may also submit a specific list of machinery and tools that you anticipate will be removed from use not later than January 1, 2010, and expect the machinery and tools will not be used at all during 2010. This list must be submitted on or before April 1, 2009, for the machinery and tools to be declared idle and unused on the 2010 machinery and tools form.
Once any property identified as “idle and unused” is returned to use, please contact our office immediately for proper reporting guidelines.
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I received the rebate last year. Do I need to apply again this year?
Yes. Each year, you must file your M&T form, pay the tax bill, and then submit a new request in writing for the rebate.
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For what period of time does the qualifying M&T receive the rebate?
Rebates are issued for five years throughout the twenty-year life of the Enterprise Zone.
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Who qualifies for the rebate?
The qualification actually is determined by asset, individually. Each year, therefore, the M&T taxpayer must submit an asset list detailing the acquisition and cost figures of each asset, including also a declaration of any disposals or replacements.
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What if I replace a qualifying asset before its rebate period is over?
The rebate on qualifying replacement assets is limited to an amount equal to the increase in M&T tax assessed on the replacement equipment over the tax assessed on the M&T that were replaced. It is the responsibility of the taxpayer to identify replacement assets (as opposed to plant expansions or simple new acquisitions and separate disposals, for which the regular rules apply).
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