Managing property taxes is a complicated business. There are many issues, valuations, relationships, factor tables, jurisdictions, and deadlines to manage – enough to make someone pull their hair out… It’s our goal at Advantax to demystify property taxes and we’re giving you, a ‘Tax to Grind’ reader, an exclusive invite to be a part of the PropTax™ Assessment.

The PropTax Assessment, a first in our industry, is a tool we offer to reach this goal. The PropTax Assessment will help you identify strengths & weaknesses in your property tax process. It will give you an overview of how you and your company stack up against best practices in the industry. And if taken as a team, The PropTax Assessment will also show points of alignment and disconnects within your team.

Based on our years of experience helping hundreds of people manage their property tax issues, we’ve identified best practices. We’d like to invite you to be a part of this breakthrough 20 minute assessment. We will start with some qualifying questions and end with some key metrics. This information will provide context to your answers and will help us adjust your scores to the size and nature of your company.

To get started, send our Assessment team an email.  Look for more about The PropTax Assessment in upcoming months!

A better question would be, “Why not be transparent with your clients?” Property taxes are not mysterious and there is nothing inherently tricky about the property tax business. It is complex and it does take time to understand. There are some in the industry whose skills and experience make them really good at managing property taxes and pursuing property tax opportunities. I would argue it is their skills and experience, not the fact that property taxes are mysterious or that they hold the key to the mystery. I think transparency is a good challenge for me personally as a consultant. It is a good challenge for Advantax, the consulting organization that I manage. It is a good challenge for our industry. It’s time to start getting naked with property taxes.

A couple years ago, I had the opportunity to spend time in Park City, Utah. Great place! Highly recommend it. While there, we went hiking on a few trails. Crazy thing about mountain trails is sometimes with all the twists and turns I get a little confused as to where I am. Even with a map it can be difficult to figure out exactly where I am. 

Funny how similar personal property tax reporting can be to hiking mountain trails... Thirty-nine states tax personal property and each one (sometimes even each jurisdiction within a state) does it a little different. Combined, they have around 8,000 different depreciation tables, along with specific guidelines for how to apply them. I’m sure they do their best but it can be a bit confusing. 

In Utah, for example, in order to use an accelerated depreciation table (and thereby save taxes) for computer integrated machinery (class 2 for those interested), that machinery has to meet a whole list of conditions. One of those conditions states that the invoice for the machinery must be one line item; it can’t break out the computer components separately. So what happens if your equipment distributor uses a system that breaks those into two line items? Is there a tax strategy to working with them on how they invoice? What if you can’t find the invoice? 

To complicate matters, the Utah Tax Commission (R884-24 in case you’re interested) came up with the following wording to help define taxable tangible personal property: 

“... An item of taxable tangible personal property is not an individual component part of a piece of machinery or equipment, but the piece of machinery or equipment. For example, a fully functioning computer is an item of taxable tangible personal property, but the motherboard, hard drive, tower, or sound card are not.” 

What exactly does that mean? The machine is taxable but if it were broken down into components it would not be taxable? Would a valid property tax savings strategy be to take all your machinery apart before the next assessment date? What if you have computer integrated machinery broken into two line items on an invoice but not completely put together on the assessment date? 

I think I need to take a hike and sort this out.

A new Robin Hood movie, starring Russell Crowe and directed by Ridley Scott is being released in early May.  It will probably be a blockbuster and I have to admit I am very interested in seeing it.  Dozens of movies and television shows have been made about Robin Hood.  In 1938, “The Adventures of Robin Hood” starring Errol Flynn won three Oscars.  Who could forget the 1973 animated Disney version where Robin Hood is played by a fox?  Sean Connery and Audrey Hepburn starred in a 1976 version called “Robin and Marian”.  Who would like to forget the 1993 spoof, “Robin Hood, Men in Tights”?  Also on the forgettable list are the 1991 “Prince of Thieves” with Kevin Costner (what a horrible accent!), “Robin Hood and the Sorcerer”, “Robin Hood and his Merrie Men”, “Robin Hood of the Pecos”, “Robin of Lockslay” and even “Robin of Texas” (who would have guessed that one?).  The list goes on and on.

Why the fascination with Robin Hood?  The story of Robin Hood has captivated us for centuries.  While the earliest text about Robin Hood is in a ballad from 1450, there are hints and allusions recounting his exploits from as early as the 13^th century.  None of these are historical records.  In fact, we aren’t even sure if he is a real or made up character.  The setting of Robin Hood’s life is presumed to be in the late twelfth century of England.  King John, who ruled at the time, was corrupt and taxed his people with seemingly no restraint.  Perhaps it was hatred for King John that first promoted the legends of Robin Hood.  Hearers of the adventures found themselves dreaming of Sherwood Forest and banding together against the corrupt Sheriff of Nottingham, who carried out heavy handed collection of the oppressive taxes.

Eventually, the English lords grew tired of King John’s incompetence and his heavy handed taxation.  They gathered an army, marched into London and forced him to sign the Magna Carta (I’m pretty sure that Robin Hood was not with them, although his stories may have been in their minds).  The Magna Carta limited the Kings’ power and prevented him from collecting new taxes without consent.  The actions of the English lords were a firm stance against the Kings’ ability to tax his people without restraint and became a milestone in the evolution of taxation.

Whether Robin Hood was real or not, people have been drawn to the legend; one that revolves around stealing from the rich to help the poor – or more specifically, stealing from the corrupt government that was oppressing people with unreasonable property taxes and redistributing those overpaid taxes back to the taxpayers.  It speaks to our human desire to be treated fairly (specifically when it comes to taxation).  It was an early form of tax reform, albeit unconventional.

Remember the big hair bands of the 1980s?  Bon Jovi, Def Leppard, Night Ranger, Guns N’ Roses, Cinderella, Whitesnake, Poison, Asia….. even bands from the late 1970s participated in big hair rock n roll – Styx, Foreigner, Journey, REO.  I’m not sure what I enjoyed most about that era – the power ballads, rebellious rock lyrics, screaming guitar licks, or the weird outfits that they wore with their big hair.

Over Spring Break, I had the opportunity to visit New York City with my son.  While there we went to “Rock of Ages”, a rock musical based on classic rock hits from the 1980s.  I’m not sure how compelling the story line was but the music propelled me right back to the 1980s.  How do you like that - Big hair rock n roll presented in the form of a musical!  If you had asked anyone during the 1980s if the then current music would be effectively presented in a musical, I’m pretty sure they would have stared back at you with a blank look.  Who would have predicted that?  We were too busy looking for “Nothin But a Good Time”.

In the mid-1990s we began publishing “A Tax to Grind”, a monthly newsletter created “to entertain and enlighten those afflicted with property taxes”.  We published on paper.  That’s right, paper – remember when that was the norm?  Then about a year ago we thought, why not use those same concepts, ideas and stories, only publish them online?  A property tax blog?  Who would have predicted that in the mid-1990s?  Maybe it was the “Heat of the Moment” or we just wanted to give it to you “Anyway you want it”.  Either way www.taxtogrind.com was born.

“Three weeks!?”  Those were the words of my colleagues when I suggested we get this “blog thing” up and running in three short weeks last March.  None of us knew exactly how much work was going to be involved with starting the blog.  I just couldn’t fight the feeling anymore that there was a need to create the “Tax to Grind” community.  We posted our first blog, then our second and then 50 more to bring us to our 1 year anniversary.  Amazingly, we got it started and you joined us on the journey (almost 1000 of you have joined the community to date).  A feeling of accomplishment still lingers, twelve months later.

Big hair rock n roll morphed into a musical.  A Tax to Grind into a blog.  As the great poet, Whitesnake, said “I don’t know where I’m going, but I sure know where I’ve been”.  I’ve enjoyed writing blog articles this past year.  I sincerely hope you have enjoyed being a part of the “Tax to Grind” community and you’ll join us for many more years to come.  Who knows where we’ll go from here.

In case you forgot the 1980's big hair rock era, herer's a video to take you back. Enjoy!

Click here if you can’t view the video