Assets fully depreciated for income tax purposes and still being used in the business are still subject to the property tax. Property that is being depreciated for income tax purposes is assumed to be in use and taxable. Leased personal property is reported by both the lessee and the lessor. In most cases, taxes are assessed to the lessor. Conditional sales agree-ments are taxed to the lessee.
Personal items used in the business are taxable.
Personal property transferred between relatives is valued based on established IRS guidelines. Any deduction from fixed asset cost attributable to good will, or some other form of intangible, will only be recognized if supported by appropriate account-ing records. If acquisition cost and time of purchase information is not provided to the auditor within the requested time-frame, value will be estimated by the auditor. A personal property audit consists of a review of the taxable personal property used in a business. It serves as a review of taxpayer compliance to the statutory reporting requirements of filing an accurate affidavit.