In Texas, for property tax purposes, Personal Property is simply defined as property that is not real property. Generally, we define personal property as furniture, fixtures, machinery, equipment and inventory.
Texas requires that a taxpayer who owns personal property as of January 1, that is used to produce income, must file a personal property rendition annually. The deadline to file a rendition is April 15; however a business owner may make a written request for extension which will be granted. Failure to file timely renditions will result in penalties. Typically, taxpayers’ either use The Business Personal Property Rendition of Taxable Property form distributed by the Texas Comptrollers’ Office or rendition forms provided by appraisal districts.
After filing a personal property rendition the owner will receive a notice of value. If the property owner does not agree with the value established by the appraisal district they may file a written appeal with the appraisal review board. Typically appeals are due on or before May 31. After receiving the taxpayers’ written protest the appraisal district will typically set up an appointment for the taxpayer to have an informal hearing to discuss the details of the appeal. The taxpayer or their agent will be given the opportunity to present evidence regarding the facts relating to their appeal. Convincing evidence to support the taxpayers’ opinion of value could be, but not limited to, the following:
- Cost analysis
- Sales comparable analysis
- Comparison of the assessments of like properties
It is very important that any evidence and/or testimony be presented in a professional and compelling manner. It has been my experience that the protesting party should bring copies of their evidence for the board members and appraisal district staff. It should be noted, that pursuant to Section 41.461 (a) (2) of the Texas Property Tax Code, the taxpayer or agent is entitled to copies of any evidence that the appraisal district will present to the board fourteen days prior to the formal hearing. If a settlement agreement is not achieved, the taxpayer or agent is entitled to a formal hearing before the appraisal review board at which time both the taxpayer or their agent and the appraisal district staff will submit evidence and give testimony to the board members. The board will make their decision and issue a notice of determination which will be mailed to the taxpayer. If the taxpayer does not agree with the board’s ruling, they may file suit in district court, or in cases involving relatively small valuations, submit a request for binding arbitration.