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Personal Property

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  3. Personal Property

Personal Property

Personal property is generally defined as property not permanently affixed to or a part of realty. Everything that is not real estate is considered personal property.

The tax assessing official makes the differentiation between real property and personal property by considering the manner in which property is attached to or secured at the location and the purpose for which the property is used.

The State of Alabama is a situs state for the taxability of personal property; therefore, if property is located in the state on October 1 (the lien date), the property is taxable unless specifically exempted. The State of Alabama has constitutional and statutory exemptions. If you have any questions regarding taxability of personal property, please call our office at 334-242-1525.

Learn more from the Code of Alabama, Chapters 40-2 and 40-7.
For more detailed standards and requirements, please refer to Administrative Rules.

Value Assessment

The Property Tax Division of the Alabama Department of Revenue has established procedures in the Alabama Personal Property Appraisal Manual for determining market value and the assessed value of personal property. All counties in the state of Alabama use this manual to achieve uniformity. The type of business, type of equipment, acquisition year, and acquisition date are all used in figuring values. For example, computer equipment depreciates more quickly than items of office furniture.

Reporting Personal Property

Every individual, firm, or corporation owning business personal property in Alabama on October 1 of each year is required to report personal property. Any individual, firm, or corporation owning aircraft based in Alabama, regardless of use, and any individual firm or corporation that purchases a permanent trailer tag for a tractor trailer, truck trailer, or semi-trailer.

A complete itemized listing of all personal property owned on October 1 must be provided to the local assessing official in the taxing jurisdiction in which the property is located. This list must be submitted between October 1 and December 31 of each year to avoid penalty. The list must include a description of the property along with its acquisition date and cost.

Optional Personal Property Assessment Link (OPPAL)

OPPAL is a centralized online filing system for business personal property tax returns. All Alabama taxing jurisdictions will be required to accept business personal property tax returns filed using OPPAL; however, the system is optional to taxpayers. OPPAL will be available for use in tax periods beginning on or after October 1, 2016. Learn More .

*Eight counties in Alabama have their own online filing systems.

File with OPPAL

Personal Property Categories

  • Intangible personal property includes an owner’s representation of rights to property such as shares of stock, annuities, patents, market certificates, etc. Intangible personal property owned by businesses is not taxable under the property tax laws of this state.
  • Tangible personal property includes material items such as machinery and equipment, tools, furniture and fixtures among numerous other items. Tangible personal property is taxable to businesses for Alabama property tax purposes. Aircraft and avionics equipment is taxable for business personal property in the State of Alabama, as well as, motor vehicle “add-on” equipment. The values published by the Department of Revenue in the Alabama Uniform Motor Vehicle Assessment Schedule for Ad Valorem Taxes represent market value of motor vehicle cab and chassis only and do not include equipment and/or bodies added after a vehicle leaves the manufacturer. The “add-on” equipment and/or bodies are components, which give the vehicle added value and they are taxed as business personal property.

Business Personal Property

Business personal property is considered Class II property and is taxed at 20% of market value. Market value multiplied by twenty percent equals the assessment value, which is then multiplied by the appropriate jurisdiction’s millage rates to determine the amount of tax due. The State of Alabama publishes a personal property appraisal manual so that basic methods and procedures can be followed in the personal property appraisal process. This is done to ensure statewide property appraisal equity and the manual serves as a reference guide to Alabama’s assessing and appraisal personnel.

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