Case Study

Personal Property Schedules

Every jurisdiction that assesses personal property typically uses a standard assigned depreciation schedule for every type of asset you might report with varying classifications applied dependent upon the useful life of the asset. What happens when there is no depreciation schedule that appropriately fits an asset when examining the useful life? A re-classification negotiation and/or accelerated depreciation.

THE CHALLENGE

A Texas county was utilizing depreciation schedules for fast food equipment that were being applied across the industry. Our client owned several locations within the county that were open 24 hours a day, reducing the useful life of their assets by more than half of what the standard schedules dictated they should be. This created the need for a special case.

THE APPROACH

Our strategy was to create special case accelerated depreciation tables that would be applicable to the true useful life of these assets based on their constant use. We would need tables that were compelling and would be useful in our negotiations with the local jurisdiction. We also decided this would be a good time to leverage decade long relationships we had formed with the local personal property assessor in order to persuade their consideration of a special case scenario.

THE SOLUTION

Through applied strategy, leveraged relationships and effective negotiations, we were able to secure an average reduction of 26% in tax on all of their personal property accounts. The client was shocked that we were able to negotiate the accelerated depreciation that we secured and continues to retain us as an agent and advisor to date.

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