Assessment of Business Personal Accounts
Arkansas law, 26-2-107 states that all personal property whether real or personal property, shall be subject to taxation. 26-26-903 in Arkansas law states that every person of full age and sound mind shall list the real property of which he is the owner, situated in the county in which he resides and the personal property of which he is the owner.
If you have recently opened a business, please call our office so that we can get an assessment form to you (479-783-8948). We do have field appraisers in personal property who will drop by for a visit if you have gotten a business permit.
Each year between January and February we will send a copy of the assessment you sent to us last year. This should help you with your assessment for the current year, or you can call and ask us to send it in Excel format. Please mark through the FF&E you have disposed of and list the new purchases, new average inventory amounts for last year and supplies. You must send us your completed assessment before May 31st of each year. The state imposes a 10% penalty for all assessments after the May 31st deadline.
After we receive your completed rendition, or assessment form, we will enter all new data in the computer, figure depreciation and new values, and then mail your assessment back to you. Please check it for any mistakes. We will not be able to correct mistakes after August 1st of each year.
If you need help filling out your assessment, please call for Terry Clark or Brent Dedmon at 479-783-8948.
If you have any questions, please call any of our business assessors at 479-783-8948.
Please keep in mind, business assessors are not CPA’s or accountants. Taxes for ad valorum taxes are figured on a much broader range and differently than taxes for the IRS.
Apartment Furnishings: If apartments are rented fully furnished, the furniture must be assessed. If the apartment is only furnished with appliances, the appliances must be assessed. The contents of the rental office must also be assessed such as computer, table, chairs, file cabinets, printers and supplies as well as any lawn and pool equipment.
Appliance Dealers: Retail sales of household appliances such as stereo equipment, television and electronics. Primarily dealers or stores must assess inventory with some furniture, fixtures, equipment and supplies aiding in the sale of appliances.
Auto Dealerships, Used: As a retail business, you are generally engaged in the sale of inventory as well as providing repair service. Assessments should be made with average sales from last year’s inventory, divided by 12 months to give us the monthly average of cars sold, then the monthly average of cars sold with the average price of each car to arrive at the average dollar amount of cars sold per month. Example: $315437.00 (sales last year). Divide by 57: (number of cars sold) equals the average amount per car ($5,534). Then take 57 (number of cars sold.) divided by 12 to get the average monthly sales and multiply by the average amount per car ($5534.00) which equals the average inventory for the previous year. We need the average amount of cars sold and the average monthly sales on your assessment form. We will also need the list of furniture, fixtures, equipment and supplies Plus the average inventory of parts and equipment of your repair shop.
Auto Dealerships, New: Below is a listing of the various automobile manufacturers together with a typical value for each brand. This value represents a weighted average for that manufacturer’s various models of automobiles, vans, light trucks and utility vehicles. An auto agency may hold a franchise for more than one manufacturer line of automobiles. When this is the situation, one should weigh the various manufacturers’ values together to determine a typical value for that particular dealer. If, for example, an agency sells both Ford and Lincoln automobiles, and it is observed that there are 4 times as many Fords sold as Lincolns, the overall value per auto for that agency would be as follows:
Ford: 23,000 X 4 = 92,000
Lincoln: 38,000 X 1 = 38,000
Total: 5 @ 130,000
Average: 130,000 / 5 = 26,000 per automobile. Thus the typical value of $26,000 per vehicle could be applied to the total number of new vehicles on the lot regardless of whether they are Fords or Lincolns, so long as approximately 4 times as many Fords as Lincolns are sold by that dealer.
Bar and Nightclubs: The personal property included in bars and nightclubs will include both inventory and FF&E. These stores may provide extensive food service, but the sale of alcoholic beverages is the main product line. Businesses with greater food than beverages sales should be valued as restaurants.
Barber and Beauty Shops: Personal Property in Barber and Beauty shops consist mainly of fixed assets. Unless you carry a large inventory of hair care products to sell, your assets are high enough to cover your small inventory.
Book and Music Stores: The values in these stores are primarily inventory. However, you must assess the shelving, computers and supplies needed to conduct your sales.
Bowling Alleys: Personal property will consist of bowling balls, shoes, equipment and may include limited food service equipment such as tables and restaurant supplies.
Cafeterias: The personal property included in cafeterias will include both inventory and fixes assets. Fixed assets will include steam tables for food presentation serving. Supplies will include to go boxes and all supplies needed to operate your business.
Clothing Stores: Inventory will consist of clothing, shoes and accessories. FF&E will consist of shelving, display counters, office equipment etc.
Convenience Stores: Inventory items consist of canned, packaged and frozen foods, beverages and adult beverages, cigarettes and tobacco products. If the store serves fast foods, the FF&E should include hot food displays. Determination should be made whether the gas pumps, tanks and electronic metering equipment are owned or leased. If leased, the assessment should be made to the proper owner. Supplies should be listed for the operation of the business.
Day Care Centers: The personal property of Day Care Centers consists almost entirely of FF&E plus the supplies you need to run the day care properly.
Department Stores: Personal property included in department stores will include both inventory and fixed assets. A department store tends to offer extensive services in support of the merchandise carried. Such services may include delivery, installation, repair and financing. Department stores also must assess all of their FF& E.
Discount Stores: Personal property will include both inventory and FF&E.
Drug Stores: Personal Property will include both inventory and FF&E. Stores that offer a wide variety of merchandise, in addition to drugs and medical supplies, will also have a greater variety of fixed assets.
Dry Cleaners and Laundries: Personal property will only consist of FF&E, as well as supplies associate with the cleaning of clothing.
Electronics and Computer Sales: Personal property should include both inventory and FF&E.
Fabric and Drapery Stores: Personal property will consist primarily of inventory. You must assess your displays for fabrics and display tables along with your computers, scissors, and equipment used to operate your business.
Farm Implement Dealers: The personal property of implement dealers will include new and used equipment, parts, and accessories, as well as FF&E.
Farm Supply and Feed Stores: Personal property will include a wide variety of both inventory and FF&E. The average quality operation, often a CO-OP type store will carry a larger line of non-feed merchandise such as veterinary supplies, farm chemicals, bulk seed etc. All must be included in inventory.
Fast Food Restaurants: The personal property included in fast food restaurants will include some inventory with a majority of value represented by fixed assets.
Financial Institutions: Personal property will only include furniture, fixtures, and equipment, plus supplies needed to run the operation.
Floor Covering Stores: Floor covering is inventory and the FF&E and supplies should be included in your personal property assessment.
Florist and Gift Shops: Personal property will include both inventory and FF&E. Nearly all florists offer a delivery service, so business vehicles should be assessed separately in the vehicle section of your form.
Funeral Homes and Mortuaries: Inventories will be caskets and supplies but primarily personal property will be FF&E and supplies. Hearses and limousines should be rendered under vehicles on the form.
Furniture Stores: Personal property primarily includes inventory with some FF&E.
Hardware and Building Materials: Personal Property will be primarily inventory with some FF&E. Delivery trucks should be listed under the vehicle section.
Hobby and Crafts Shops: Include both inventory and FF&E.
Hospitals: Personal property values are primarily in fixed assets and will include some inventory. Inventory consists of medical supplies and drugs which, while not sold as in drugstores, are billed separately as part of treatment received. FF& E includes a wide variety of furnishings, equipment, specialized treatment equipment, X-ray, etc. Supplies are considered any consequential supplies needed to treat a patient.
Jewelry Stores: Inventory will be the primary personal property holdings. Fixed assets include display cases, security systems and anything commensurate with inventory quality.
Laundromats: Personal property will be limited to FF&E. Some cleaning supplies may be vended on the premises and should be counted as inventory.
Medical and Dental Offices: The personal property in medical and dental offices will include furniture, fixtures, and equipment, no inventory to be sold is assessed. However; you must assess the expense of equipment and supplies needed by the nurse or doctor for the treatment of patients
Liquor Stores: Personal Property includes inventory and FF&E plus supplies such as wrappings.
Manufacturers: You must fill out a manufacturer’s inventory report form. We must have your Annual Average of Raw Materials, Annual Average of Work-in-Progress, Annual Average of Unsold Finished Goods, Annual Average of Not Consumed in Work in Progress, (Supplies), and Sales. The sales must be listed as sales in Arkansas at Cost, Sales outside of Arkansas as Cost, and the Total of all Goods Sold.
Mobile Home Dealerships: Personal property will consist primarily of inventory; that is homes held for sale. If you have “floor planned inventory” then we would need the average inventory of units sold for last year.
Motels and Hotels: Personal property will include furniture, fixtures, linens and equipment. Inventory of related services, such as restaurants and gift ships, should be assessed separately.
Motorcycle Dealerships: As a retail business, motorcycle dealerships are engaged in the sale of an inventory of new and used cycles as well as the provision of a repair service. Parts must also be assessed as inventory.
Newspaper and Print Shops: Personal property will consist almost entirely of FF&E. Print shops and newspapers providing print shop services will carry a limited line of inventory.
Nursing and Convalescent Homes: Personal property included in long-term health care facilities will include only furniture, fixtures, and equipment. While they maintain stocks of food and ancillary medical supplies, these are not retailed in the manner of true inventory items.
Office Supply Stores: Personal property included in office supply stores will consist primarily of inventory with some FF&E. If the store offers custom printing services, it may be valued as office supply stores if at least 70% of total revenue is generated through the sale of office equipment and supplies.
Offices, Commercial: Assessments should be made on furniture, fixtures, supplies and equipment. No inventory.
Pizza Parlors: Both inventory and fixed assets should be assessed as well as supplies such as to go boxes etc.
Recreation Establishments: Furniture, fixtures and equipment should be assessed and in some cases a small amount of food inventory.
Recreational Vehicle Dealerships: Motor homes are considered motor vehicles under Arkansas Law and thus the inventory of recreational vehicle dealerships should be assessed according to the average number of units sold. FF & E and supplies to make the sales should be assessed.
Sporting Goods Stores: Personal property includes inventory, FF & E, and supplies.
Supermarkets: Establishments primarily selling a wide variety of foods as well as packaged or bulk dry groceries must assess their average monthly inventory from last year. Store fixtures, furniture and equipment are a large part of the assessment. You must also assess supplies such as grocery bags and packaging materials.
Tire Stores: Furniture, fixtures, equipment, and inventory of tires, oil, and other supplies must be assessed. Service trucks should be assessed under vehicles.
Truck Dealerships: As a retail business, truck dealerships are engaged in the sale of a wide variety of inventory as well as the possible provision of a repair service. Equipment in a repair service must be assessed along with inventory, furniture, fixtures, and supplies.
Toy and Game Stores: Personal property included will include primarily inventory with some fixed assets and supplies.
Variety Stores: Personal property will include FF&E and inventory. You must also assess supplies such as packaging materials.
Video Rental Stores: The best approach to valuation of videotapes, whether held for sale or for rent is to apply an average value per tape. The average value of the tapes should be applied to the tapes owned and rented out by the store and rendered as inventory. Furniture, fixtures, equipment, and supplies shall also be assessed.
“It is our duty to be fair and equitable to all tax payers in Sebastian County.” Zach Johnson, Assessor.