Forbes Realty, LLC
Forbes Realty, LLC
Kim Forbes, Forbes Realty, LLCPhone: (602) 388-3400
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Tangible personal property taxes: Basic info to know

by Kim Forbes 06/01/2022

What is the difference between property tax and tangible personal property tax? While property taxes are commonly understood as payments on your home or land, tangible personal property is a less common term used in real estate. Referring to physical objects other than the literal land or building, personal tangible property is important in commercial and rental businesses. Here is the basic info to know about personal tangible property and associated taxes:

Tangible personal property examples

Some examples of business assets qualifying as tangible personal property include:

  • furniture
  • production machinery
  • computers
  • delivery vehicles

Individuals and households may have personal tangible property such as:

  • jewelry
  • collectibles
  • sports & hobby equipment

You can think of tangible personal property as anything of value with physical existence. Other assets, such as patents and copyrights, do not count as tangible personal property as they are not literally tangible.

How tangible personal property taxes work

Similar to regular property taxes, personal tangible property taxes are based on a percentage of either the asset's sale price or assessed value. Landlords and businesses have to report these assets on a tax return, as long as they are related to a business. Taxes are paid to the local government, and in some cases can qualify for tax deductions on federal income tax returns.

Understanding personal tangible property taxes is crucial if you're planning on investing in a commercial or rental property. Keep this basic info in mind when considering your next move in real estate investment.

About the Author
Author

Kim Forbes

As a full-time Real Estate Broker with Forbes Realty in Phoenix, AZ, I’m dedicated to providing professional, responsive, and attentive service to home buyers and sellers. Looking for an agent who truly listens to your needs? Need someone skilled at marketing your home to get it sold quickly and at the best price? I’m here to help! Reach out today—I’d love to chat about your real estate goals.