Tangible personal property taxes: What they are & why they matter
What is the difference between property tax and tangible personal property tax? While property taxes are commonly understood as payments on your home or land, tangible personal property is a less common term used in real estate. Referring to physical objects other than the literal land or building, personal tangible property is important in commercial and rental businesses. Here is the basic info to know about personal tangible property and associated taxes:
Tangible personal property examples
Some examples of business assets qualifying as tangible personal property include:
- furniture
- production machinery
- computers
- delivery vehicles
Individuals and households may have personal tangible property such as:
- jewelry
- collectibles
- sports & hobby equipment
You can think of tangible personal property as anything of value with physical existence. Other assets, such as patents and copyrights, do not count as tangible personal property as they are not literally tangible.
How tangible personal property taxes work
Similar to regular property taxes, personal tangible property taxes are based on a percentage of either the asset's sale price or assessed value. Landlords and businesses have to report these assets on a tax return, as long as they are related to a business. Taxes are paid to the local government, and in some cases can qualify for tax deductions on federal income tax returns.
Understanding personal tangible property taxes is crucial if you're planning on investing in a commercial or rental property. Keep this basic info in mind when considering your next move in real estate investment.
About the Author
Julia Brown and Barry Weiss Weiss
Introducing the partnership of Brown & Weiss. Julia & Barry have a combined 23 years of experience in real estate and over 70 combined years of customer service. They each have lived in the Wilmington area for over 20 years and are very familiar with the local market. Their savvy negotiations and cutting edge marketing join uncompromising integrity as the hallmarks of Julia and Barry’s service. They are well respected in the Wilmington area not only for their professional track record and high ethical standards, but for being hardworking individuals that will do anything in their power to ensure their client’s success. Julia and Barry enjoy working for the number one real estate company in the area- Coldwell Banker Sea Coast Advantage. With the Coldwell Banker brand and their experience behind the sale or purchase or your home, you can’t go wrong. So, put us to work for you today and “Let us light your way home".
