Personal Property

Most people know that property tax applies to real property. However, some people may not know that property tax applies to personal property used when conducting business.

The chief characteristic distinguishing personal property from real property is mobility. Land and improvements to land are considered real property. Unless specifically exempted by law, all other property is taxable as personal property.

County assessors and treasurers administer the property tax. Assessors value property at its fair market value. Treasurers collect the property tax. The state of Washington Department of Revenue advises assessors and treasurers, and oversees the valuation and taxation of property across the state.

Affidavits: By April 30 each year, property owners are required to file an annual listing of personal property used in the conduct of a business. These personal property affidavits, which are available from the assessor's office, must list all taxable property located in the county as of 12:00 noon on January 1 of that year. Property owners are required to file a separate affidavit for each place of business in each county. Assessors must allocate assessed values to the taxing district in which the property is located.

The affidavit must:

1. Identify each taxable category. For example, office equipment must be separately identified as computers, desks, facsimile machines, etc.
2. Include the date each item was acquired.
3. Include the total purchase cost of each item, excluding sales tax. The total purchase cost of an item includes all costs associated with making the property operational. For example, installation, freight charges and the value of any trade-in are costs that may be incurred while placing property into operation.
4. Include all supplies on hand as of January 1. This includes office and retail (cash register tapes, bags, etc.) supplies.

After property is listed on the tax rolls for the first time, the assessor mails the property owner a new affidavit at the beginning of each calendar year. By April 30, the property owner must certify that the list is correct, add any new acquisitions and delete any property disposed of, sign and return the affidavit to the county assessor. Property owners are responsible for filing the personal property affidavit every year, even if the property owner does not receive an affidavit in the mail.

Penalty for Failing to List Property: The assessor may assess a penalty for failing to file a personal property affidavit. The penalty is five percent of the tax due per month, up to a maximum penalty of 25 percent.

Valuation: The assessor values the property listed on the affidavit at 100 percent of its current market value. Market, or true and fair value, is the amount that a willing and unobligated buyer is willing to pay a willing and unobligated seller. After valuing property, the assessor informs the property owner of the property's assessed value.

Appeal of Assessed Value: Property owners should contact the assessor's office if they feel an assessment is incorrect. The assessor, or the assessor's representative, can explain how the value was determined and, if appropriate, make any necessary corrections. If the property owner still believes the assessment is incorrect or excessive, the assessment may be appealed to the County Board of Equalization.

Appeal forms are available from the assessor or the County Board of Equalization. The Board must receive the appeal within 30 days of when the assessment was mailed or by July 1 of the assessment year, whichever date is later.