Colorado Property Tax Information
Property taxes are a fact of life for every property owner, but each state sets its own property tax rates for individuals and businesses. Many states have different rates for homeowners and business owners. Like most states, Colorado’s personal property tax laws tend to favor homeowners over business owners, with commercial and business tax costing property owners more than homeowners.
New Business Exemption
While some people favor this, others say that the higher taxation on businesses deters new businesses from developing in the state. Fortunately, Colorado has enacted certain laws designed to encourage new business establishment in the state, such as an exemption under the §39-3-119.5 Colorado Revised Statutes. This law makes it so that as of 2015, business owners don’t have to file a personal property declaration if the total value of their property is $7,300 or less. This measure was supposedly taken to give new businesses a break and chance to get on their feet before burdening them with the brunt of property taxes in the state.
In Colorado, personal property is valued by depreciating the original installed cost of the property. Property owners are required to file Declaration Schedules with assessors that list all their property, including furniture, equipment and anything else that is used int the business to generate revenue. That Colorado Department of Taxation allows three different approaches to be used in determining the depreciated value of property.
- Cost approach. With this approach, the cost of the materials is estimated as well as the installation costs that it would cost to replace the property to determine its value.
- Market approach. The market approach determines value by comparing the value of similar businesses and property’s values.
- Income approach. This approach converts the net income of the property to the potential worth of it.
In Colorado, federal depreciation and accounting methods are not allowable methods of valuation.
Assessment Technologies Experts
Assessment Technologies can assist commercial and business property owners in ensuring that the get the lowest rates possible on their taxes. They use a unique valuation method that takes all three valuation approaches into consideration to determine the actual value of business and commercial property. Determining the value of business property is oftentimes more difficult than it seems since special considerations need to be taken into consideration with such equipment. Assessment Technologies experts are industry professionals who are familiar with such equipment while all county assessors are not.
Additionally, Assessment Technologies can help business owners ensure that they’ve taken advantage of all exemptions and deductions they’re eligible for. For instance, many new businesses in Colorado don’t receive the new business exemption because they are unaware of it and don’t file for it. These experts will ensure that business owners do.
Colorado Property Tax Resource: colorado.gov/pacific/dola/property-taxation