Personal property appraisal in Arizona covers many different property types, a few of the property types subject to property taxation are:
Cable television systems
Farm and ranch equipment
Industrial, commercial and office equipment
Personal property is generally valued using the cost approach, as this is the most reliable method for the majority of types. RCN for personal property includes the purchase price of the item, plus installation labor, shipping costs, and any taxes applicable to the item. Depreciation is then applied to the amount to arrive at RCNLD.
Market Value Sources
Personal property appraisers that establish market value use many different sources. Retail and wholesale price books, vehicle "blue books", industry catalogs and owner records of purchases are all used. The Department of Revenue Personal Property Manual contains tables which include factors for both appreciation and depreciation, which can then be used to arrive at RCNLD. Appreciation is included in order to accommodate for the effects of inflation on prices, although the tables are referred to as depreciation tables.
Merchandise held for resale (inventory) is exempt from taxation, and thus valuation. In Arizona, the personal property reporting system is self-reporting. The Assessors ends a notice demanding a listing of personal property to commercial enterprises within the county, and the business must return the form within 45 days with a listing of the property (the form is the 82520 for business, and the 82520A for agricultural property).
Audits may be used to check accuracy and completeness of the listings. Household goods not used for commercial purposes are exempt from taxation in Arizona.
All forms are subject to audit and forms returned late are subject to a penalty. Please refer to Arizona Revised Statutes:
42-15053 Duty to report personal property: confidentiality
Any person who knowingly fails or refuses to furnish the assessor with such information or material as demanded under section ARS 42-15052 is guilty of class 2 misdemeanors.
Improvement on Possessory Rights
An Improvement on Possessory Rights (IPR) situation takes place when the owner of the improvement is not the owner of the real property and usually when the improvement is located on unpatented land, a mining claim or state land. According to ARS 42-19003 and 42-19116 the improvement must be entered on the personal property tax roll. Improvements may consist of, buildings, wells, appurtenances, stock tanks, and any other fixed property.