When you own a business, you’re legally required to report any personal property used in your business to the county appraisal office. A personal property rendition is a form stating information about your personal property, which helps the county decide how to tax you and your business. Here’s a guide to making personal property claims. If you need further help, don’t hesitate to reach out to Medina & Company Consulting, Inc.

What is business personal property?

Businesses can own two types of property: real property, like land and buildings, and personal property. Personal property is all property except real property, from the pens you keep on your desk to the desk itself. Tangible personal property may be subject to property taxes. If you use the property to produce an income, you need to file a rendition.

Cash, accounts receivable, computer software and similar items do not count. You may also receive exemptions for certain items.

Information needed for a personal property rendition

When you seek a personal property rendition, you’ll need the following information:

• Location: You should provide information about where the property was located on January 1, even if the property was in transit or may have been in multiple locations.
• General description: Next, you’ll provide a general description of each item. You don’t need to account for every pen you own, but you should group items into categories (office furniture and supplies, electronics and more). If you have business vehicles, include them and the license plate or VIN.
• Quantity: After you’ve gathered information about the location and general description of each asset, you’ll need to assign them a quantity. Sometimes this is easy to find—your inventory records should tell you how much product you have in stock at any given time.
• Original cost: Hopefully, you’ve kept good records and receipts for all of your business assets. You’ll need to provide their original cost (“historical cost when new”), as well as any expenses incurred in buying and transporting the item.
• Market value: If you choose not to provide information about original cost, or don’t have the information on hand, you can instead provide a fair assessment of market value. “Market value” is determined by what the property would command on the current open market, in good faith. (“Good faith” assumes that there’s time to find a buyer, both buyer and seller are aware of any defects and other considerations.)
• Date of acquisition: Finally, you will need to provide a date of acquisition. This is another reminder to keep good business records.

If you fail to provide accurate personal property renditions, you could be subject to hefty fines and fees. It’s much smarter to get help with your personal property claim from a reputable accounting firm.

Medina & Company Consulting, Inc. can help with your personal property claims. If you’re struggling to value your property or understand how to report, give our firm a call. We’ll be happy to help take the confusion and work out of your reporting requirements.