Tangible Personal Property (better known as Personalty) is all property owned or held by a business to operate that business, including but not limited to, furniture, fixtures, vehicles, tools, machinery, equipment, raw materials, and supplies. One of the most common tests used to differentiate "personal property" from "real property" is whether it is moveable (personal) or affixed (real). In Tennessee, personal property is assessed at 30% of its value for commercial and industrial property and 55% of its value for public utility property.
Not later that 1 February each year, the Assessor of Property is required to furnish each applicable business in the county with a Schedule B for listing all of their tangible personal property. Those business owners (or agents) must then complete and return those forms to the assessor's office prior to 1 March. In many cases, for an existing business, this simply involves listing the equipment acquired or disposed of during the previous year, so that it may be added to or removed from the schedule already on file. It is basically a "self declaring" system, but is subject to audit for verification. Unlike the system for assessing real property, where the appraisal is based on fair market value and equalized across the entire jurisdiction, the appraisal of personal property is based on the actual cost of the property plus depreciation. Personal property is categorized in10 groups for reporting. Each of those groups has its own depreciation schedule that is outlined in state statutes. In Tennessee, leased personal property used by a business is assessed to the lessee (user) and must also be reported on a company's reporting schedule. For smaller accounts, the system allows an alternate method for reporting personal property. If you believe the depreciated value of your business's personal property is $1,000 or less, you can declare so in the reporting schedule and you do not have to itemize or report detailed costs. With this certification, subject to audit, your assessment will be set at $300. Again, the deadline for filing Personal Property Reporting Schedules is March 1 each year. Failure to return the schedule by that date may result in a forced assessment of the business's personal property using information about the quantity and value of personal property held for use by businesses of similar size and function.
As with "real property", a property owner has the right to appeal their personal property assessment, beginning with the Sumner County Board of Equalization and continuing until satisfied or their appeals are exhausted. For the initial appeal to be heard, however, the taxpayer must first file a completed schedule.
For more information on tangible personal property, reporting procedures, and your rights and responsibilities as a property owner please contact the Assessor of Property Office.