Personal Property Valuation
Legislation was passed in 2013 (HB 35) which allows a business with a taxable value less than $10,000 to be exempt from personal property tax. A business must complete a Schedule A, sign in the exemption box on the signed statement, and return the forms to our office by May 15 every year to qualify for this exemption.
Three Primary Problems Submitting Affidavits
- First, if you are a new business reporting for the first time, you need to fill out your Schedule A. If the new business does not fill out a Schedule A then it is treated as one where the affidavit has not been returned and is subject to the same penalties and interest.
- Second, business owners forget to sign the affidavit. An unsigned affidavit must be returned to the business owner for signature. The account is treated as one where the affidavit has not been returned and is subject to the same penalties and interest. Avoid this situation by remembering to sign the affidavit.
- Third, business owners sometimes forget to send the check with the affidavit. Avoid this situation by remembering to enclose your signed check.
All equipment or fixtures used in the operation of a business are taxable under Utah law. All items must be reported whether they were acquired before or after the start-up of the business. Also, equipment that the owner requires an employee to provide needs to be reported by the business owner or by the employee.
Frequently Asked Questions
- When I buy a business do I use the acquisition cost of the original owner or does my purchase create a new acquisition cost?
- At the time of the sale a new market value was established. The new owner will need to report the acquisitions, purchase price, and date of their purchase.
- How am I taxed when I lease equipment?
- If the lease agreement is a true lease and the equipment is truly owned by the leasing company, the leasing company is responsible to report the equipment and pay the taxes on it. The lessee reports the same equipment along with the leasing company's name and address. If the lease agreement is a financial arrangement for the purchase of the equipment, the affidavit should be filed and the tax paid by the lessee. If you are leasing equipment and have questions about the terms of your lease contact your lessor to find out if the leasing company is reporting and paying the taxes on the equipment.