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Thursday, February 22, 2018

MT DOR Personal, Business & Commercial Property Reporting

The Montana Department of Revenue has mailed several notices in recent weeks related to property reporting.  Many taxpayers have found these notices confusing.  It's important to know which of these reporting types apply to you and what your requirements are in order to avoid either unnecessary reporting or penalties for failure to report.  

PERSONAL PROPERTY (BUSINESS EQUIPMENT)
If you received a letter that indicates you need to "report your personal property (business equipment)" then this is mandatory reporting and must be submitted online by March 1st to avoid a 20% penalty on the tax due.  Personal property taxes (separate from real estate property tax) are billed and collected by the country treasurer.  This tax essentially replaces sales tax on items such as business equipment, machinery, agricultural implements and equipment, furniture, fixtures and all other personal property.  

In the past, this reporting has been mailed to taxpayers including a list of equipment previously reported.  The MT Dept of Revenue is no longer mailing these forms and reporting must be submitted online via TAP (TransAction Portal) .  If you have not previously used TAP, select the sign up now button.  You will need your personal property reporting account ID (found at the top right of your letter) and your EIN or SSN to set up your account.  Select either Business or Individual and then Personal Property Reporting (PPR) from the drop down list.  More information and tutorial videos can be found at https://mtrevenue.gov/property/property-types/personal-property/

COMMERCIAL PROPERTY INCOME & EXPENSE DATA 
If you received a notice that "commercial property owners will need to report their income and expense data"  then this is voluntary reporting. MT DOR requests commercial property owners to report their rental income and expense information in order to collect data and develop typical rent ranges, expense percentages and capitalization rates for use in income models.  They DO NOT use this information to value your property individually, therefore you are not required to submit this reporting.  However, if you choose to submit this data, I could benefit your ability to appeal property tax values in the future.  More information and instructions for submitting this report online can be found at https://mtrevenue.gov/property/property-types/commercial-property/

Gardner & Billing CPAs are happy to be of assistance if you have questions related to these reporting requirements or if you need help with the online submission.