Nonprofit Property Tax Changes

Posted on Wednesday, February 10, 2016

The following changes have been made effecting nonprofit property tax filings in Indiana.

Assessment Date

Senate Bill 420, signed into law in March 2014 and became effective July 1, 2014, changes the assessment date for tangible personal property from March 1 to January 1 beginning in 2016.  Therefore, when filing your organization’s next property tax return, you will report tangible personal property on hand as of January 1, 2016 instead of March 1, 2016.  The due date to file property tax returns is still May 15th of each year.

Exemption Due Date

Certain property that is owned, occupied and used predominately for charitable, religious, educational or scientific purposes may be exempt from property taxation.   To obtain an exemption, the property owner must file an Application for Property Tax Exemption (Form 136) with the county assessor where the property is located.  A separate exemption must be filed for each parcel of property (location).  Previously the application was required to be filed on or before May 15th of the assessment year.  Beginning in 2016, the property tax exemption application is due April 1st of the assessment year.

Personal Property with an Acquisition Cost under $20,000

In May 2015, Senate Enrolled Act 436-2015 (SEA 436) was signed in to law.  SEA 436 states that a business with tangible personal property with an acquisition cost of less than $20,000 is eligible for an exemption from property taxes and is not required to file a personal property tax return.  However, the taxpayer must, before May 15th of the calendar year in which the assessment date occurs, file with the county assessor an annual certification stating that the taxpayer’s business personal property in the county is exempt from taxation for that assessment date.  The certification must be notarized and signed under penalties for perjury.  Each county may impose a local service fee for filing this certification of not more than $50.

Although this change to property tax filings for property under $20,000 may affect many for profit businesses, it does not directly affect nonprofit organizations.  The Application for Property Tax Exemption (Form 136) filed by nonprofit organizations to obtain an exemption from property taxes, takes precedent over the $20,000 exemption.  Therefore, nonprofit organizations should continue to file their property tax returns as they have in the past and not file an annual certification.

For additional information on nonprofit property taxes, see Nonprofit Property Taxes and Property Tax Exemption on Real Estate.

Posted by: Carrie Minnich, CPA

Posted in Mission Minded Nonprofits

Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.

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