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BPP Notice of Value
Valuing Business Personal Property
Business Personal Property is not taxable until the assessment date following the year in which the property is acquired and first put into use. Property value is not prorated.
The valuation and taxable status, as of January 1, remains for the entire year even if the property is:
- Enters or leaves the state
- Changes taxable status after the assessment date
When any of these changes occur, taxpayers need to modify their asset listing when filing their declaration schedule the following year.
Appraisal Methodology for Business Personal Property
The Assessor determines the actual value of property by assessing:
Consists of comparing fair market sales of comparable property.
Estimates of the current selling price of the owner’s furniture and equipment. The selling price is then rolled back to the appropriate level of value used for Real Property.
Estimates the material and labor costs to replace the subject property with a similar property.
Estimates the current replacement cost and the total accrued depreciation of the item. The estimate of value is then rolled back to the appropriate level of value used for Real Property.
Converts net income from rent to a potential worth.
Applies to leased or rented equipment when net income can be converted into an estimate of value. The value is then factored back to the appropriate level of value.
Natural Resource Properties
- Oil and Gas Leasehold and Lands The valuation for assessment for producing oil and gas leaseholds and lands is 87.5% of the selling price of oil and gas sold or transported from the premises from primary recovery during the preceding calendar year; or 75% of the selling price of oil or gas sold or transported during the preceding calendar year from secondary recovery, tertiary recovery, or recycling project facility.
Equipment and improvements or buildings of natural resource properties are valued separately by using the three approaches to value: market, cost and income.
Mobile Equipment Located in Several Counties
The owner must show the following information with their Business Personal Property schedule:
- Kind, description, and serial number of equipment
- The counties in which the equipment will be located
- Estimated time in each county
- Mobile equipment includes drilling rigs
The Assessor in the county of original assessment will determine a value that is apportioned to each county.
Note: Some equipment is classified as type “F”, or as special mobile equipment, and is valued and taxed by the local county clerk. This property should be declared as such on the Personal Property Declaration Schedule filed by the owner.
Colorado law states that January 1 is the assessment date. The Assessor determines the current use and condition of the property as of January 1 each year.
The Assessor multiplies the actual value by the assessment rate of 29% to arrive at an assessed value. The assessed value is multiplied by a mill levy (tax rate) to calculate the taxes for the property.
Actual Vaule results from the taxpayer’s Original cost factored to a Replacement Cost New, depreciated to the original year of acquisition, and factored to the base year.
Note: This assessment value does not include residential property, oil and gas lands, and producing mines.
For more information, please contact the Assessor’s Office Personal Property Department at 303-441-3316.