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June 3, 2009 Property Taxes and Your Industrial Property Return (IPR) Filing SEDCOR members may file annual property tax returns with the county or Department of Revenue in the spring that will be used to determine their property taxes later in the fall. The process for turning the costs for buildings, machinery and personal property into real market values and finally property taxes can seem mysterious. There are many ways to shed light on this process and to address your filing concerns, too. This article focuses on the filing process for taxpayers reporting to the Department of Revenue on Industrial Property Returns (IPR's) from the January assessment date until the assessment roll is "frozen" in September, but the county process is similar. The Department of Revenue is staffed with industrial appraisers who are assigned to industry-specific teams and individual property tax sites for annual return processing. Their task is to look at a "snapshot" of the property on each tax account as it exists on January 1st of the calendar year and to develop values for that property for the coming tax year. This snapshot includes all buildings and structures, all machinery and equipment, and all personal property on a site, organized into accounts by site owner and tax lots. Real property (buildings and machinery) and personal property (generally smaller items like furniture and desktop computers) are on separate accounts, so most taxpayers file an IPR covering two or more property tax accounts. The January 1 "snapshot" for the IPR includes property added to the account during the prior calendar year plus items being installed on January 1st. It does not include items retired from service during the prior year. The IPR filing process, completed during March or April (depending on extensions), tells the appraiser what items have been added or removed from the account during the previous year. The taxpayer generally reports the complete costs for those items, including installation, freight, wiring, and other cost components to bring them into service. Not all costs add value, though, and the appraisers use various appraisal techniques to translate those costs into values. The values are compiled onto value transmittal sheets (one per account) which are mailed to the taxpayers and the counties by about July 1st. These values, called "real market value" by statute, are then analyzed by the county for statutory impacts due to Measure 5 and 50 tax limitations, exemption requirements, and other factors to arrive at the assessed value on which property taxes will be based. It's a long process - starting with a March filing and extending to your tax statement in October! There are five things you can always do during the process to make sure that you have the information you need and that your concerns are addressed: 1) Become Informed - The Department offers free taxpayer training for IPR filers every year before the filings are due. The classes are typically three hours long and are offered several times in January or February. This is a great way to make sure your filing is accurate and to meet the actual appraiser that will be working your account for the coming year. Information about these training sessions is listed at the end of this article. 2) Add Information to the Regular Industrial Filing - Do you have special concerns about your reported property or your plant in general that doesn't fit in the schedules on the return? Feel free to add any information you'd like the appraiser to know. The value may be impacted by many things. Buildings may not currently be functioning for their originally intended use. Machinery may be configured in an awkward way due to building limitations. The demand for your product may have changed, impacting the efficiency of your plant. Let your appraiser know about your concerns so they can be addressed during the valuation process. 3) Develop a Dialogue - It's likely that the appraiser will have some questions about your filing. He or she may have questions about certain reported items or general questions about larger projects that may extend beyond a single year. Feel free to call your assigned appraiser with questions. If you're not sure who your assigned appraiser is, call the Valuation Section at the phone number listed below and ask. If your appraiser calls you, please call back. A quick conversation now can save hours of time later. 4) Review Your Value Transmittal Sheets as Soon as You Get Them - Does anything look odd? Are you concerned that your reported retired items are not showing up or that an exemption notation is missing? Call the appraiser whose name appears on the value transmittal sheet and discuss it. Because of the complex county roll process, the longer you wait, the more complicated it is to make changes. 5) Arrange for a Visit - A picture is worth a thousand words - and so is a visit! If you have concerns that are hard to fit in an IPR filing schedule or a phone call, invite the appraiser to come to your site and look at your concerns with you. Site visits often take place by July or August so the appraiser can incorporate the new information before the values are placed formally into the assessment roll in September. A final suggestion - keep a photocopy of your filing for the following year! This will save you time and help you remember what's already been included in your value when you start the filing process over the following year. When you follow these easy steps, your filing process becomes much easier to understand and a team effort with your assigned appraiser. General Contact Information and Filing Tips For filing tips, go to: http://www.oregon.gov/DOR/PTD/301-472.shtml For IPR questions generally, call: (503) 945-8278 For Taxpayer Training Sessions in 2010 Next Offered on Wednesdays from 9AM to 11:30, Jan. 20 & 27th and Feb. 3 & 10th, 2010 at the Department of Revenue, 955 Center St. in Salem Call Colleen Tarr at (503) 945-8277 or Email colleen.l.tarr@state.or.us to sign up. (Email her for a quick Email confirmation of your training request!)
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