If you own a business and if you are paying a lot on personal property taxes then this article is for you. You can reduce the personal property taxes you are currently paying for your business by opting for a BPP tax protest. Let us start off with understanding what business personal property is.
Business personal property
Items that a business uses to conduct business and that can be moved is referred to as business personal property. These items might include furniture, machinery, tools, etc and these items are taxable. Now let’s understand how BPP affects property taxes.
Most businesses pay attention to the simple form they’ll have to fill every year. Failing to fill out this form correctly or failing to meet the compliance requirements might put your company at risk. This might result in penalties or interest for non-filing and you might also lose control over your tax liability. It is always better that you manage, document, and report your personal property assets properly, if ignored it might result in higher property tax which in turn might become a threat to your bottom line. Obsolescence is another factor that impacts your business personal property taxes. BPP tax is assessed based on the depreciation, wear, and tear of the asset from the date it was acquired through the date of filing. The sad part is that many taxpayers are not aware that they have a legal right to depreciation that might reduce the tax liability.
Tips to reduce your business personal property tax
Start off with developing a strategy. Work with your team and determine who is responsible for what. Then research the jurisdiction’s requirements and know your deadlines.
Secondly, keep your records up to date. Collect information on the production declines, equipment’s that are not state of the art for documentation purposes. This might help in claiming the additional loss in value.
Make sure ghost assets are excluded from being taxed. To make sure ghost assets are not included review your business assets on a regular basis.
Look up to your fellow industry leaders and see how their business personal property is managed and make sure you follow the industry standards.
Handling business personal property might seem tedious and also requires expertise. Many companies fall short in this and hence opt for property tax consultants to handle it.
If you own a business and if you feel completing BPP rendition is eating your time and is a tedious task leave it to the experts. Learn more about personal property valuation in this book “What You Need To Know About Personal Property Valuation“, the only book on BPP valuation.