Business Personal Property


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FAQ


Personal property is defined as property that is not real estate. Taxable personal property includes property used for commercial, industrial, agricultural purposes and manufactured housing. Personal property is movable but may be attached to real estate. Personal property that is attached to real estate usually can be removed without causing damage to either the property from which it is removed or to the personal property itself. Property taxes in Arizona are imposed on both real and personal property.
"Ad valorem" is Latin for "according to value"-The basis for an ad valorem tax is the value of the real or personal property.
Full Cash Value (FCV) is the depreciated value of your property, or more technically defined as the current replacement cost new less depreciation of your property.
Real property is the rights, benefits and interests in the ownership of real estate, which includes land, buildings and other improvements located on the land.
The Legal Class is a statutory category that is used to classify property based on the use of the property. This classification determines the assessment ratio for your valuation.
Personal property is valued through the cost approach to value. Based on original cost and age of all personal property in your possession as of December 31st of the prior year, the County Assessor will calculate the current replacement cost new less depreciation (Full Cash Value) of each item. The Assessed Value is based on the Full Cash Value, and the assessment ratio for the legal class of the property. The tax rates for the county and local governmental jurisdictions in which the business operates are applied to the Assessed value. The formulas for calculating Full Cash Value and Assessed Value are:
  • Full Cash Value = Original Cost multiplied by Valuation Factor (AZDOR Personal Property Manual, Chapter 10)
  • Assessed Value = Full Cash Value multiplied by Assessment Ratio (varies per Legal Class of property per ARS Title 42, Chapter 15, Article 1. For example: 10% for class 3, residential, 20% for 1 & 2P, Commercial (adjustable by year) and 16% for class 2R vacant land)
The Assessed Value divided by 100, times the tax rate (set in August of each year) determines property tax billed in September. The County Treasurer bills, collects and distributes the property taxes. Note: to compute taxes for Business Personal Property:
  1. Compute the FCV using the reported costs and the Tools on the Website.
  2. Subtract the statutory exemption, if applicable.
  3. Calculate the Assessed Value: Multiply the remaining FCV and the assessment Ratio of the properties legal class.
First time reporting should be completed using our self-report form located on our website. Once you have reported your assets, an account number will be assigned to your business. You will receive a preprinted statement the following year.
The statement is not a tax bill; it is the annual reporting form for your business to submit changes on your account, (i.e. additions or deletions to equipment, name and address changes). The form is annually due back to the Assessor's Office no later than April 1.

Business personal property deals with the physical assets used in the operation of the business. Verify the information on the form is correct; make changes to the assets on the back of the statement or attach a complete asset list to the statement.

Include the following information: asset description, acquisition year, acquisition cost, any freight, installation, special support, special wiring, special plumbing, and sales tax paid.

To add or delete equipment from your return, use the back side of the form (section 4). When adding equipment, list the total acquisition cost under the appropriate schedule column and the year acquired at the far left of that row in the additions section.

When deleting equipment, list the costs by acquisition year in the deletions section. You must verify that the acquisition year you are deleting is preprinted on the front of the form; if not, deletion will not be considered.

Equipment is qualified if this is the first time it is being assessed in Arizona. Used equipment which has been previously assessed is generally not qualified. Please contact us if there are any questions with regards to previously assessed equipment.
Complete section 1 on the front of the form to identify any changes to the business name, mailing address, or location address.
No, with minor exception, inventory for sale is not taxable in Arizona.

You must submit a written request with the account number to receive a duplicate form.

Fax your request to (602) 506-7335 or email Asr-bpp-pubasst@maricopa.gov. Duplicate forms may be sent as an email attachment, faxed, or mailed. If you are a tax agent, an agency authorization form is required when requesting the duplicate form.

Your return must be postmarked no later than April 1 by the United States Postal Service or certified mail only. Internal company owned postal meters are not accepted as valid postmarks.
Inform us by writing on any open space on the front of the statement or attach a separate letter with your account number, the date your business closed, and what happened with your equipment. You may also notify us at any time of a business closure by emailing Asr-bpp-pubasst@maricopa.gov with the information above.
The Assessor's Office mails out Valuation Notices in July/August. The Valuation Notice will identify your Full Cash Value, Assessed Value and appeal deadlines.
By statute, you have 30 days from the notices mailing date to file a petition for review of valuation, (DOR form 82530). The Assessor's Office has 20 days to respond to your petition. If the disputed value has not been settled by that time, you may file with the Arizona State Board of Equalization within 20 days of the Assessor's decision mailing date.
The first $50,000 in full cash Value is exempt from taxation for class 1 and 2.P agricultural properties. This exemption amount is determined annually by the Arizona Department of Revenue per A.R.S.§ 42-11127(C). Note: the Statutory Exemption is $185,811 in 2020.
The 'Exemption' applies only once throughout the state for each legal Business entity. Businesses with multiple accounts' having a combined total Full Cash Value less than the determined limit, then all accounts receive the 'Exemption'. Otherwise the "exemption" would only apply to accounts up to the limit, any remaining accounts in the multiple would not receive the exemption.
The valuation notice details show if the account received the exemption. It is displayed under the header Exemption Maricopa. You can also lookup the same data on our website
By statute, the tax on business personal property is a debt against the owner. Typically, the leasing company will pay the taxes and issue their own billing to the lessee for reimbursement. Please review your lease agreement for details.
No. The Counties are solely responsible to value and to collect the Personal Property Taxes for the equipment. Separately, the Arizona Department of Revenue charges "Sales Tax", (technically labeled "Transaction Privilege Tax"). The Arizona Department of Revenue charges these taxes on every invoice your leasing company bills to customers in Arizona.
The best way to report any equipment that has been previously assessed by another business entity is to maintain the historical acquisition cost and dates. By reporting the historical information, you will maintain the depreciation already applied to the assets.