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Personal Property Assessment & Taxes

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1. What is personal property?

Personal property is identified as the tangible assets of a business, inclusive of all related trade fixtures, though not real estate.

2. What are examples of personal property?

Personal Property consists of office furniture, office equipment, testing, diagnostic, and electronic equipment, machinery and equipment, coin operated equipment, rental DVDs, games and video tapes, computers and computer-related equipment, as well as, all related trade fixtures of a business.

3. When is tax day for personal property?

Tax day is December 31. The current tax year is based on December 31 of the prior year.

4. When and where do I file my personal property statement?

Personal property statements are to be filed on or before February 20 of each year (a statutory deadline) with the city, village or township where a business is located.

5. When and where do I file an Affidavit of Eligible Personal Property (Small Taxpayer Exemption Form 5076)?

The Affidavits of Owner of Eligible Personal Property are to be filed on or before February 10 of each year (a statutory deadline) with the city, village or township where a business is located.

6. What happens if I file my personal property statement late?

Personal property statements that are filed after the February 20 deadline are considered late. By law the assessor is required to estimate an assessed value.

7. Can I request an extension for filing my personal property statement?

No, the statutory deadline for personal property filings is February 20. Therefore, extensions are not granted.

8. What costs do I report on my personal property statement?

All costs are to be reported as the original costs in the year of purchase, inclusive of sales tax, freight, and installation costs.

9. What if my costs are for used assets?

Do not report used costs within page 2 of the personal property statement. If the asset was purchased used, you must report the original cost of the asset in the year it was purchased new. It may require contacting the seller to determine original cost.

If you’re unable to ascertain the original cost of an asset, list the asset on a separate attachment including the year of purchase. Please include a description and the amount you paid for it, inclusive of sales tax, freight, and installation costs.

10. What if I have expensed or fully depreciated my assets?

Assets that are expensed or fully depreciated are assessable as personal property. Based on your expense records, report all assets that were acquired for your business. If your assets are fully depreciated, you are still required to report them until they have been physically disposed of, scrapped, sold, etc. The costs must include sales tax, freight, and installation.

11. I don't own a building, though I lease office space. Do I still have to file for personal property?

Yes, personal property is a tax on the tangible assets of a business, inclusive of all related trade fixtures. The real estate (building/structure) will be taxed separately as real property.

12. I operate a business out of my home, do I have to file for and pay personal property tax?

Yes, regardless of where the business operates, the tangible assets of the business are subject to personal property tax.

13. Do I report leased equipment?

Yes, the leased equipment would be reported on page 3 of the personal property statement. The description of the leased asset, the name of the leasing company, its original cost and year of purchase must be included in the statement.

To determine if it is your responsibility or that of the leasing company to file and pay the personal property tax pay careful attention to the details of your lease agreement.

14. How can I appeal my personal property assessment?

When you receive your Notice of Assessment, you will see the scheduled dates and times of your local March Board of Review. You may either schedule an appointment with your local Board of Review or you may appeal directly to the Michigan Tax Tribunal.

An appeal directly to the Michigan Tax Tribunal requires that your personal property statement has been filed by the February 20 statutory deadline. If you did not file your personal property statement, you must first appeal to the March Board of Review. Further, if your appeal is to the Michigan Tax Tribunal, you must meet their filing deadline of May 31 (or the agricultural personal property filing deadline of July 31).

15. What if I don't agree with the decision of the March Board of Review?

You may appeal to the Michigan Tax Tribunal, as indicated in your notification of the decision of the March Board of Review.

16. Where does my tax money go?

When you receive your personal property tax bill, it will have an itemized listing of how the collection is distributed. It is distributed to the related taxing authorities.

17. What are my responsibilities as a business owner?

You must notify your local assessor when your business moves in or out of the jurisdiction. If you purchased or will be acquiring an existing business make sure the seller has paid the personal property taxes. The tax bills may be in the name of the old business, but the lien remains on the personal property until it is paid.

18. What happens if my business moves out prior to tax day?

Contact your local assessor and inform him/her of your move. Personal property taxes are not prorated. You will have a tax liability to the jurisdiction for the current tax year. The current tax year is based on December 31 of the previous year, i.e. On December 31, 2019 (Tax Day), your business was located in the Township of Garfield, however, in June 2020 (the current tax year) you moved your business to the City of Traverse City.

Your tax liability remains with the Township of Garfield for the current tax year because on tax day, December 31, 2019, you were in the Township of Garfield. You will have tax liability in the City of Traverse City beginning in tax year 2021 if you are in the City on December 31, 2020.

19. What happens if my personal property taxes become delinquent?

The non-payment of personal property taxes could result in the seizure of your business assets. Once the opportunity for appeal has passed, the assessment and tax bills are valid. Once the due date of your tax bill passes (summer or winter), interest and penalties will accrue until the tax bill is paid.

In March of the following year, delinquent taxes are turned over to county treasurer for collection. The treasurer is authorized to seize and sell the personal property of the business if the personal property taxes remain unpaid.