Placer County California

Business Property Questions and Answers

Why do I have to pay taxes on my business personal property?

Why do I have a business property statement?

What is this Form 571 Business Property Statement for?

What will happen if I do not return this form?

How do I fill out the form?

How is the assessed value determined?

What if I do not agree with the values? Can my value be reviewed?

I paid sales tax when I purchased this equipment. Why am I paying taxes again?

I have a home-based business and all my equipment is my own personal equipment. Do I have to report it?

What if I lease all my equipment, do I still have to report?

What do I include in supplies?

What should I do if I’ve closed, sold, or disposed of my business after January 1?

What should I do if I’ve closed, sold, or disposed of my business before January 1?

Can my unsecured business property taxes be prorated?

What is Unsecured Property?

My business property is movable and goes in and out of the county depending on the job. Who am I supposed to report to?

I filed bankruptcy. Why do I have to pay the tax?

Why do I have a penalty on my tax bill for my business?

I don’t own the building, I just rent. Why do I have a bill?

Can someone else file my business property statement for me like my CPA?

I closed my business and the business assets are not being used. Why do I have a tax bill?

Why do I have to pay taxes on my business personal property?

California Constitution Article XIII and Revenue and Taxation Code section 201 states that all property is taxable unless it is stated that it is exempt. Business personal property is not exempt.

Why do I have a business property statement?

This is a requirement of section 441(d) of the Revenue and Taxation Code. Statements are sent in order to gather the most up to date information on the business property so that an accurate value can be determined.

What is this Form 571 Business Property Statement for?

All businesses in California are required to annually fill out a Property Statement when requested by the Assessor. If a business has a Personal Property cost of $100,000 or more, they are required to file a Property Statement even if not requested by the Assessor. Reportable assets include equipment (both owned and leased), supplies, office furniture, and construction in progress.

What will happen if I do not return this form?

It is important that the statement be returned even if you no longer own the business property. If a statement is not returned, an estimated assessment will be made using the best information available, and a 10% penalty on the assessed value will be added for failure to file per Revenue and Taxation Code section 463.

How do I fill out the form?

Refer to the instructions provided. If you still have questions, please contact the Assessor’s Office at (530) 889-4300 or visit our office at 2980 Richardson Drive, Auburn.

How is the assessed value determined?

Depreciation tables are set for different types of equipment. The depreciation tables are based on the annual Equipment and Fixtures Index, Percent Good and Valuation Factors approved by the California State Board of Equalization. We depreciate your equipment’s original costs by its type and year to arrive at the fair market value. Click here for a listing of equipment factors and classification.

What if I do not agree with the values? Can my value be reviewed?

You may call, email, or write the Assessor’s Office to discuss the value and request an informal review. You can also file an Application for Changed Assessment by calling (530) 889-4020. (http://www.placer.ca.gov/bos/Clerk/PTaxAppl.aspx)

Should your value notice be the result of an Escape Assessment, you have 60 days from the date of the Notice of Enrollment of Escape Assessment to file an application.

I paid sales tax when I purchased this equipment. Why am I paying taxes again?

Sales tax and property taxes are two different types of taxes. Sales tax is paid at the time of purchase, and business personal property taxes are paid annually.

I have a home-based business and all my equipment is my own personal equipment. Do I have to report it?

Yes. If you are using it in your business, it is reportable, assessable, and taxable as Business Personal Property.

What if I lease all my equipment, do I still have to report?

Yes. True leases are reported in Part III on the front of the property statement, and conditional sales agreements are reported on Schedule A and identified as such.

What do I include in supplies?

Examples of reportable supplies are: ordinary office, janitorial, manufacturing, fuel and chemical supplies. Fuel, insecticides and fertilizer used by agricultural taxpayers. Medical supplies held by a doctor’s office to be given to patients, incidental to service, even if the samples were provided at no charge.

Put in the total amount you had on hand on January 1st. If you’re not sure, make an estimate of the amount you normally keep on hand.

What should I do if I’ve closed, sold, or disposed of my business after January 1?

Under California Law, the owner of assessable business property on 12:01 a.m., January 1 lien date, is responsible for taxes and must be assessed at full value. Sale, closure, or disposal of property after the lien date does not relieve the assessee of the obligation to pay taxes.

What should I do if I’ve closed, sold, or disposed of my business before January 1?

Please complete, sign, date, and return a Business Property Affidavit to the Placer County Assessor’s Office. Based upon that affidavit, a review of your assessment will be completed. (http://www.placer.ca.gov/Departments/Assessor/Forms/BusinessForms/PCA528BusinessPropertyAffidavit.aspx)

Can my unsecured business property taxes be prorated?

No. Unsecured bills are never prorated regardless of the disposal date. Proration of taxes should be done between the buyer and seller at the time of sale.

What is Unsecured Property?

Unsecured property is a personal liability of an assessee that has not had its payment secured by the ownership of the land.

My business property is movable and goes in and out of the county depending on the job. Who am I supposed to report to?

Business property is assessable where habitually situated. The location where property is habitually situated is the location at which the property returns or is normally stored when not in use.

I filed bankruptcy. Why do I have to pay the tax?

Bankruptcy does not relieve the Assessor of determining a fair market value. Assessed value and payment of taxes are separate issues. Please contact the Placer County Tax Collector at (530) 889-4120 for issues regarding whether payment is required after bankruptcy. (http://www.placer.ca.gov/Departments/Tax.aspx)

Why do I have a penalty on my tax bill for my business?

Either the Assessor’s request to file a valid property statement was not received by May 7th, or no statement was received. Revenue and Taxation Code section 463 mandates that a late filing penalty of 10% of the assessed value be added for statements not timely filed by May 7th. The Assessment Appeals Board is the only authority with the ability to abate a penalty for late filing. (http://www.placer.ca.gov/bos/Clerk/PTaxAppl.aspx)

I don’t own the building, I just rent. Why do I have a bill?

The bill is not for real property such as the land or building. It is for the business personal property and fixtures used in the operation of a business such as desks, computers, counters, tables, stoves, and racking.

Can someone else file my business property statement for me like my CPA?

Yes. A current and valid Agency Authorization must be on file with the Assessor’s Office. Failure to have an Agency Authorization on file may lead to a penalty being added to your value for non-valid filing. (http://www.placer.ca.gov/Departments/Assessor/Forms/BusinessForms/PCA429AgencyAuthorization.aspx)

I closed my business and the business assets are not being used. Why do I have a tax bill?

Business property not in use but located within the county is still assessable. If you have received a Business Property Statement you should complete it for the remaining property and add a letter of explanation as to where and what the remaining assets are.

If you have not received a Business Property Statement you should complete and return a Business Property Affidavit to the Placer County Assessor’s Office. There is a section regarding property remaining after a business closure. Based upon the information you provide, a review of your assessment will be completed.

For additional information on Business Property, please visit the California State Board of Equalization at: http://www.boe.ca.gov/proptaxes/faqs/personal.htm.


Home > Departments > Assessor > Frequently Asked Questions > Business Property FAQs	Monday, May 21, 2012