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Business Personal Property is everything which is not real property, typically portable or movable items. Business Personal Property includes furniture, equipment, machinery, security devices, signs, and personal effects not otherwise exempt by law.
The Colorado Business Personal Property tax is a levy on Business Personal Property used in a business or organization. The procedure for applying this tax is similar to that used for real property: the Assessor estimates a value for the property and consolidates the levies; the Treasurer then mails a tax bill to the property owner.
Business Personal Property is taxable if it is used for the production of income (that is: used in a business, organization, or rental property) at any time during the year, unless specifically exempted from taxation.
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The Assessor mails Declaration Schedules on or before January 1, and taxpayers must return them to the Assessor by April 15. It is the responsibility of the business owner to obtain and file a Declaration Schedule if one is not received in the mail.
The owner of the property (as of January 1) is considered the owner for that entire assessment year. If a property changes ownership during the year, it is up to the buyer and seller to prorate the taxes. Neither the Assessor nor the Treasurer is involved in or responsible for this process. It is the responsibility of the taxpayer to notify the Assessor and the Treasurer when a business changes ownership. If a business closes after the January 1 assessment date, the taxpayer is responsible for the entire year.
The County Assessor’s duty is to value personal property for property tax purposes. The property owner files a Declaration Schedule with the Assessor, listing information regarding the Business Personal Property which enables the Assessor to estimate the actual value of the property. Actual Value (Market Value) is estimated by following the guidelines and procedures set forth by the State of Colorado. Federal depreciation or accounting methods are not allowable methods of valuation.
Owners of Business Personal Property must declare the taxable property they own.
Owners of taxable Business Personal Property, such as equipment, machinery, furniture, security devices, signs and personal effects not otherwise exempt by law must declare these items to the Assessor, only if the total actual value (market value) of the personal property is greater than $7,900.00.
Note: Market value is approximated by an appraisal, using state guidelines and procedures.
- Effective January 1, if the total actual value (market value) of your Business Personal Property located in El Paso County is $7,900.00 or less, you are not required to file a Declaration Schedule.
- If an owner’s Business Personal Property filed in El Paso County exceeds a total value of $7,900.00, all the property is taxable including the initial $7,900.00.
- In the event additional assets are put into use which increases the total actual value of the personal property to an amount greater than $7,900.00, the owner must file a Declaration Schedule.
- To avoid a possible misunderstanding regarding whether a Declaration Schedule must be filed, new businesses, first time filers, and taxpayers who are unsure as to the actual value of their personal property are urged to contact the Assessor and provide an itemized listing of their Business Personal Property.
Any owner of Business Personal Property who fails to file a Declaration Schedule by
April 15, or by the end of the extension time requested, will be fined $50 or 15% of the taxes due, whichever is the lesser amount. In addition, if a Declaration Schedule is not received, the Assessor shall estimate a value for the property value according to the best information available. Failure to make a complete disclosure of personal property will result in an additional penalty of 25% of the undisclosed property.
To ensure that all taxpayers receive just and equalized appraisals for their property, Colorado law requires the Assessor physically inspect Business Personal Property in the County on a regular basis. Property owners will be contacted by the Assessor’s Office when their Business Personal Property account has been selected for an on-site review.
ALL Business Personal Property used in a business, organization or rental property at any time during the year must be reported to the Assessor for Business Personal Property assessment. Following is a partial list of typical items which must be reported:
Machinery, equipment, and other articles related to the business or a commercial or industrial operation, not the components of fixture systems that are required for the proper operation of the improvements.
(Computer software is exempt from personal property tax)
Leasehold improvements: Certain leasehold improvements are considered personal property. (Property owners report leasehold improvements on the Declaration Schedule, and the Assessor must decide whether these improvements are personal property as opposed to real property improvements.)
Signs: Any type of signage representing a business, organization, or property.
NOTE: Declaration Schedules must list Business Personal Property in detail. This includes reporting the deletion of previously reported items that are no longer in use.
In 2000, C.R.S. 39-3-119 was amended to exempt Consumable Business Personal Property. To be classified as Consumable Business Personal Property, the item must fall under one of the two following criteria:
The item must have an economic life of one (1) year or less. This criteria applies to all items of Business Personal Property regardless of original acquisition cost. This category also includes non-functional Business Personal Property items used as a source of parts for the repair of operational machinery and equipment.
The item of Business Personal Property has an economic life exceeding one (1) year and has an acquisition cost, inclusive of installation cost, sales tax, and freight expense of $350 or less. If an item is acquired or is provided to the business owner at nominal or no cost, the $350 per item ceiling shall apply to the fair market value of the item at the time of the acquisition. The $350 per item ceiling applies to each personal property item as completely assembled for use in the business.
When the Assessor has estimated the value of your Business Personal Property, you will receive a Notice of Valuation (NOV). This is not a tax bill! The purpose of the notice is to inform you of any change in your property valuation and advise you of your right to appeal the new value. Personal Property Notices of Value are mailed on June 14. If the 14th falls on a weekend, then the following Monday is the due date for the Assessor to mail the Notices of Value.
When you receive your NOV, study it carefully. The Notice describes the property you own, gives the actual value for both the prior and current year, advises you of any amount of change, and provides an opportunity to present your objections to the Assessor.
Keep in mind that a changed value on the Notice may affect the amount of tax you pay the following January. If the NOV reflects a value with which you disagree or if you have questions about the valuation, call your County Assessor! Don’t wait until you receive your tax bill the following January.
If you disagree with a change in value, you may file an objection with the Assessor in the County where the property is located. The Assessor must give a decision, in writing, by July 10.
The Business Personal Property Appeals Form will be available June 15, the beginning of the Business Personal Property Appeals period.
If the date for filing any report, schedule, claim, tax return, statement, remittance, or other document falls upon a Saturday, Sunday, or legal holiday, it shall be deemed to have been timely filed if filed on the next business day.
If you are dissatisfied with the Assessor’s decision, you may appeal to the County Board of Equalization. The CBOE conducts hearings through August 5. The Board must notify you in writing within five business days after their decision is made.
If you are dissatisfied with the CBOE decision, you may appeal to the Board of Assessment Appeals (BAA), to the County Commissioners for binding arbitration, or the District Court of the County in which the property is located. Appeals to the BAA or District Court must be filed within 30 days of the CBOE decision.
If you are dissatisfied with the decision of the BAA or District Court, you may appeal to the Court of Appeals within 30 days of the BAA decision or 45 days of a District Court decision.
- Decisions reached through arbitration are final and not subject to review.
The County Treasurer is responsible for mailing property tax bills and collecting the property taxes. Each year taxpayers receive their property tax bills after January 1. If the amount is $10 or less, the County Treasurer may add an administrative fee of $5 to your bill. If the tax amount is GREATER than $25, you may pay the taxes in two equal payments. The first half is due in the Treasurer’s Office by the last day of February, the second half is due by June 15. If you pay your taxes in a LUMP SUM, the payment is due by the last day in April. If your payment is late, interest is added to the tax amount.