For taxation purposes, your property is classified as either real property (land, buildings, and other items attached to land) or personal property (items that can be owned but are not attached to land). Tangible personal property that you use to produce income is subject to taxation in the State of Texas.
Tangible personal property includes such things as furniture, fixtures, inventories, equipment, motor vehicles, vessels, and aircraft. These items are typically referred to as business personal property.
SB 340, passed in the 2003 regular legislative session, took effect January 1, 2004. If you own a business, or have tangible personal property used for the production of income, you are required by this law to report personal property that is used in the business to the appraisal district. There are substantial civil penalties for failure to report, and both civil and criminal penalties may be applicable for falsification and tax evasion.The Smith County Appraisal District has prepared a Guide to Personal Property Rendition to assist you in understanding and complying with this new law which you can view on this website.
Copies of the rendition form, along with other tax forms, can be reviewed and downloaded.
Texas law requires the appraisal district to determine the January 1 market value of business personal property, even if the business owner fails to render it.
As already noted, your first responsibility as a business owner is to file an annual personal property rendition with the appraisal district. As a courtesy, the appraisal district in January mails rendition forms to businesses known to have been in operation in the prior year. If your business does not receive a form, it is your responsibility to contact SCAD and ask for a blank form.
The filing deadline for renditions is April 15.
The rendition asks for information about the business location and the identity of the owner. The form asks you to provide an itemized listing of your business personal property assets. If you wish, you may provide your opinion of the property's value. Various sections of the rendition deal with inventory, consigned goods, raw materials, work in process, furniture and fixtures, machinery and equipment, computers, leasehold improvements, and supplies.
In preparing your rendition, remember that personal property is taxable only if you own or possess it on January 1. The information you provide on your rendition should reflect the ownership, location, and assets of your business as of January 1. Business assets that were temporarily outside Smith County on January 1 may still be taxable here, depending on their use.
Your rendition to the appraisal district is confidential by law.
In the late spring, after renditions have been reviewed and field work completed, the appraisal district determines the situs (place where taxable) of business personal property and establishes proposed values. Then, the district mails notices of appraised value to business owners. Even though the value notice is not a tax bill, it is important that you review it carefully.
If you disagree with SCAD's determinations of the appraised value or taxability of your business personal property, you have the right to protest before the Smith County Appraisal Review Board (ARB). The ARB is an impartial body of 9 citizens who sit in panels to hear value-related protests.
To receive a hearing, you must file a written notice of protest with the ARB. The protest must include your name and address, a description and identification of the property, and an indication that you are dissatisfied with some action taken by the appraisal district. Protest forms are available at the SCAD office or on this web site. Unless the appraisal district sends you a value notice that specifies a different protest deadline, the last date for you to mail your protest and have it postmarked by the post office is midnight May 31.
It is often possible for issues to be resolved without having to appear before the ARB. Many of your questions can be answered by phoning the Smith County Appraisal at (903) 510-8600, or by visiting SCAD's office at 245 SSE Loop 323 Tyler.