Who must submit a personal property listing and pay personal property tax?
Anyone operating a business is required to provide an annual listing of personal property to the county assessor for assessment and taxation purposes. (Washington State Law RCW 84.40.020 and 84.40.040) by April 30 each year.
Who assesses my personal property?
The assessment is done by the county assessor's office in which the equipment is physically located.
How do I report my business assets to the county?
Our office accepts Online filings, paper listings and Excel files. Excel files can be sent by email. The Excel file must list all equipment in place as of January 1 each year including a description, original year acquired and original cost less sales tax.
Only one filing type is necessary. If you have filed online or emailed an Excel file to our office, you do not need to send paper copies by mail.
If you have not filed with this office before, you may complete our personal property questionnaire and return it to our office. Contact our office at 360.337.7160 or by email if you need a paper questionnaire.
What personal property do I need to report?
Report all business equipment you own/control, lease, formerly leased but now own, leasehold improvements and supplies. Include all equipment the business had as of January 1 each year. For example, if you had $25,000 of business assets in place as of January 1, 2022, you would report them on the listing due April 30, 2022. Items obtained after January 1, 2022 but still in place as of January 1, 2023 would be reported the following year.
Washington Administrative Code (WAC) 458-12-060 defines the requirements for the listing of personal property.
Examples of taxable equipment include but are not limited to:
*Office equipment
*Furniture and fixtures
*Retail store fixtures and equipment
*Machinery and equipment
*Supplies and materials not held for sale or not components of a product
*Leasehold improvements and signs
Do I need to include items that are used for both business and personal use?
Yes, you need to report equipment used in your business that is also used for personal activities, for example, computers, cell phones or furniture. Even if the item is only used 20% of the time for business purposes, it is 100% assessable as business personal property.
What is included in the cost of my equipment?
List the total purchase cost of your equipment, excluding sales tax. The total purchase cost of an item includes all costs associated with making the equipment operational: for example, installation, freight and engineering costs. Include the value of any trade-in.
What about supplies and inventory?
Supplies include items such as paper, envelopes, toner, other general office supplies, cleaning products, salon products and other items used to conduct everyday business. Report the cost of supplies on hand as of January 1 or use 1/12th of your annual supply expense, whichever is easier to determine.
Inventory (items held for resale) are exempt and do not need to be reported.
What about current and formerly leased equipment used in a business?
Both need to be reported. Much of the equipment being leased is categorized as a "true lease" or an "operating lease" where the lessor (leases equipment to another) owns and reports the equipment on their personal property account, however, the lessee (using the leased equipment) must report the equipment on their listing as well. The lessee must report capitalized leases or equipment leased by a finance agreement as owned equipment on their account.
Assets you formerly leased but now own should be added to your account using the original year acquired and original equipment cost.
When is the personal property listing due?
The personal property listing is due April 30 each year. As a property owner, you are responsible for filing a personal property listing each year, even if you do not receive the form by mail or if there are no changes in equipment to report.
What if I miss the April 30 filing due date?
We encourage you to file your listing as soon as possible. Late filing accounts are subject to a penalty of 5% per month late, up to 25%. This penalty is applied to the property tax due and will be added to your personal property tax statement.
What if I do not submit a listing or complete the personal property questionnaire?
An estimation of assessed value will be applied to businesses that fail to complete the filing process by April 30. Estimated values do not depreciate and are subject to increase annually.
Personal property accounts are established for unreported businesses found as a result of research. In order to accurately assess accounts that have not reported, a detailed listing of equipment used to run the business should be submitted by April 30. If no listing is submitted, an estimated value based on businesses that appear similar in nature will be used for the initial assessment.
Are there any exemptions?
There is a $15,000 "Head of Family" exemption for sole proprietors meeting additional qualifications. You must claim this exemption when submitting your listing each year. We will review your eligibility and apply the exemption as applicable. If eligible, the exemption will reduce your assessed value for taxes due the following year.
Several types of personal property are exempt from taxation. Household goods and personal effects for personal home use are exempt, unless they are used for business purposes. Other exempt personal property includes custom software (designed specifically for your business), inventories held solely for resale, motor vehicles licensed for road use and intangible personal property.
What happens after I submit a completed listing?
The information you provide will be entered into our computer system and will be used to calculate the assessed value. The Washington State Department of Revenue provides annual valuation guidelines for personal property assessment purposes which take into consideration the age, cost and type of equipment.
After your account is processed, a personal property assessment notice will be sent by mail or email (for accounts filing online or by Excel file). Review your assessment notice for accuracy. This value will be multiplied by the levy rate for your business location to determine the personal property tax amount to be typically billed the following year.
What if I disagree with my valuation?
We encourage you to contact us and we will review your account information with you to ensure accuracy. If appropriate, our personal property specialist may make an adjustment. If the assessed value is still disputed, you have 60 days from the date on your personal property assessment notice to appeal the value to the County Board of Equalization.
I am just starting a business, when do I need to report business equipment?
You need to report your equipment in the year that the business was first in operation on January 1. For example, if you started your business on May 15, 2022, you would submit your first personal property listing by April 30, 2023 to report equipment as of January 1, 2023. You may use our personal property questionnaire to establish a new account.
When are the personal property taxes due?
Personal property is assessed as of January 1 each year and the property tax is billed the following year. For example, equipment reported to our office as of January 1, 2022, will be assessed in 2022 for taxes billed in 2023. If the amount of tax due is less than $50.00, full payment is due by April 30. If the tax due is $50.00 or more, half the amount may be paid by April 30 and the balance by October 31.
More information on personal property taxes is available from the Kitsap County Treasurer's Office.
What happens if I close or sell or buy a business?
If you have decided to sell or close your business, please complete the Advance Tax Request Form. This form provides us with information we need to update the business account with the new owner's information or to cancel the account if the business is closing. This will ensure that the final tax bill is sent to the appropriate person.
Please note that relocating or reorganizing your business should not be considered the same as closing the business. You still need to report the equipment. The account can be updated to reflect a new location or change in legal entity by annotating your listing or by sending us an email with the new information.
If you are buying, selling or closing a business, property tax may be due. The Kitsap County Treasurer's Office provides additional information on personal property tax and can confirm if taxes are owing.
