This document includes Senate 2nd Reading Floor Amendments incorporated into the bill on Thu, Feb 20, 2020 at 11:50 AM by lpoole.



Chief Sponsor: Karianne Lisonbee

Senate Sponsor: Daniel McCay


8     Committee Note:
9          The Revenue and Taxation Interim Committee recommended this bill.
10               Legislative Vote:     12 voting for     0 voting against     7 absent
11     General Description:
12          This bill amends provisions related to tax exemptions for tangible personal property.
13     Highlighted Provisions:
14          This bill:
14a     Ŝ→      ▸ modifies the requirements for qualifying for a property tax exemption for tangible
14b     personal property owned by a business; and ←Ŝ
15          ▸     modifies the calculation of the inflation adjustment that applies to the property tax
16     exemption for tangible personal property that has an aggregate taxable value of
17     $15,000 or less.
18     Money Appropriated in this Bill:
19          None
20     Other Special Clauses:
21          This bill provides a special effective date.
22          This bill provides retrospective operation.
23     Utah Code Sections Affected:
24     AMENDS:
25          59-2-1115, as last amended by Laws of Utah 2019, Chapter 463

27     Be it enacted by the Legislature of the state of Utah:
28          Section 1. Section 59-2-1115 is amended to read:
29          59-2-1115. Exemption of certain tangible personal property.
30          (1) For purposes of this section:
31          (a) (i) "Acquisition cost" means all costs required to put an item of tangible personal
32     property into service; and
33          (ii) includes:
34          (A) the purchase price for a new or used item;
35          (B) the cost of freight and shipping;
36          (C) the cost of installation, engineering, erection, or assembly; and
37          (D) sales and use taxes.
38          (b) (i) "Item of taxable tangible personal property" does not include an improvement to
39     real property or a part that will become an improvement.
40          (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
41     commission may make rules defining the term "item of taxable tangible personal property."
42          (c) (i) "Taxable tangible personal property" means tangible personal property that is
43     subject to taxation under this chapter.
44          (ii) "Taxable tangible personal property" does not include:
45          (A) tangible personal property required by law to be registered with the state before it
46     is used:
47          (I) on a public highway;
48          (II) on a public waterway;
49          (III) on public land; or
50          (IV) in the air;
51          (B) a mobile home as defined in Section 41-1a-102; or
52          (C) a manufactured home as defined in Section 41-1a-102.
53          (2) (a) The taxable tangible personal property of a taxpayer is exempt from taxation if
54     the taxable tangible personal property has a total aggregate taxable value per county of $15,000
55     or less.
56          (b) In addition to the exemption under Subsection (2)(a), an item of taxable tangible
57     personal property, except for an item of noncapitalized personal property as defined in Section
58     59-2-108, is exempt from taxation if the item of taxable tangible personal property:

59          (i) has an acquisition cost of $1,000 or less;
60          (ii) has reached a percent good of 15% or less according to a personal property
61     schedule published by the commission pursuant to Section 59-2-107; and
62          (iii) is in a personal property schedule with a residual value of 15% or less.
63          (c) For an item of taxable tangible personal property that is not exempt under
64     Subsection (2)(a) or (b), the item is exempt from taxation if:
65          (i) Ŝ→ (A) ←Ŝ the item is owned by a business and is not critical to the actual business
65a     operation of
66     the business; Ŝ→ [
and] or
66a          (B) beginning January 1, 2021, the item is owned by a business; and ←Ŝ
67          (ii) the acquisition cost of the item is Ŝ→ : ←Ŝ
67a     Ŝ→      (A) ←Ŝ less than $150 Ŝ→ [
.] ; or
67b          (B) beginning January 1, 2021, less than $500. ←Ŝ
68          (3) (a) For calendar years beginning on or after January 1, [2015] 2021, the
69     commission shall increase the dollar amount described in Subsection (2)(a):
70          (i) by a percentage equal to the percentage difference between the consumer price
71     index for the preceding calendar year and the consumer price index for calendar year [2013]
72     2019; and
73          (ii) up to the nearest $100 increment.
74          (b) For purposes of this Subsection (3), the commission shall calculate the consumer
75     price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
76          (c) If the percentage difference under Subsection (3)(a)(i) is zero or a negative
77     percentage, the consumer price index increase for the year is zero.
78          (4) (a) For the first calendar year in which a taxpayer qualifies for an exemption
79     described in Subsection (2)(a), a county assessor may require the taxpayer to file a signed
80     statement described in Section 59-2-306.
81          (b) Notwithstanding Section 59-2-306 and subject to Subsection (5), for a calendar
82     year in which a taxpayer qualifies for an exemption described in Subsection (2)(a) after the
83     calendar year described in Subsection (4)(a), a signed statement described in Section 59-2-306
84     with respect to the taxable tangible personal property that is exempt under Subsection (2)(a)
85     may only require the taxpayer to certify, under penalty of perjury, that the taxpayer qualifies for
86     the exemption under Subsection (2)(a).
87          (c) If a taxpayer qualifies for an exemption described in Subsection (2)(a) for five
88     consecutive years and files a signed statement for each of those years in accordance with
89     Section 59-2-306 and Subsection (4)(b), a county assessor may not require the taxpayer to file a

90     signed statement for each continuing consecutive year for which the taxpayer qualifies for the
91     exemption.
92          (d) If a taxpayer qualifies for an exemption described in Subsection (2)(b) or (c) for an
93     item of tangible taxable personal property, a county assessor may not require the taxpayer to
94     include the item on a signed statement described in Section 59-2-306.
95          (5) A signed statement with respect to qualifying exempt primary residential rental
96     personal property is as provided in Section 59-2-103.5.
97          (6) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
98     commission may make rules to administer this section and provide for uniform
99     implementation.
100          Section 2. Effective date.
101          If approved by two-thirds of all the members elected to each house, this bill takes effect
102     upon approval by the governor, or the day following the constitutional time limit of Utah
103     Constitution, Article VII, Section 8, without the governor's signature, or in the case of a veto,
104     the date of veto override.
105          Section 3. Retrospective operation.
106          Ŝ→ [
This bill has] The actions affecting Subsection 59-2-1115(3) have ←Ŝ retrospective
106a     operation Ŝ→ [
for a taxable year beginning on or after] to ←Ŝ January 1,
107     2020.