Business Tangible Property and Vehicles
Tangible personal property, as defined by state code, is all personal property not otherwise classified as intangible personal property, merchants’ capital, or as short-term rental property (Code of Virginia, §58.1-3500). In general, tangible personal property is a moveable item that is real, material, substantive, and not permanently affixed to any real property. Examples of business tangible property include office furniture, computer hardware, specialized tools, machinery, equipment, and vehicles.
When and How to File
Business furniture and fixtures, machinery and tools, and computer equipment that are located in Fairfax County, the towns of Herndon, Vienna or Clifton as of January 1 each year must be declared on county tax forms. The filing deadline is May 1. Late filing penalties may be assessed for renewals submitted after May 1. If the filing deadline falls on a Saturday, Sunday, or county holiday, the deadline is the following business day.
Businesses who filed with the Department of Tax Administration (DTA) in the previous year will receive an application form in the mail in January. First time applicants may download the Business Return of Tangible Personal Property and Machinery and Tools from our website.
In addition, business vehicles must also be reported. Business vehicles are assessed and taxed like any other vehicle in the county, except that they are not eligible to receive the state’s Personal Property Tax Relief Act subsidy that is available for personal use vehicles. Refer to our Understanding Vehicle Taxes page for more information about vehicle taxes.
Tax Basis for Business Tangible Property
Tax on business tangible property (except vehicles) is not prorated. If the property is not in the county on January 1, then no taxes are owed for that year. Conversely, if the property is in the county as of January 1 but is disposed of during the year, then tax is still owed for the entire year.
Assessed value of all business tangible property (except vehicles) is determined by a set percentage (based on the purchase year) of the original capitalized cost or the cost that would have been capitalized if the expense deduction in lieu of depreciation was elected under § 179 of the Internal Revenue Code. Original capitalized cost is the actual cost of the business tangible property before any allowance for depreciation. It includes all costs associated with putting an asset into use (such as sales tax, delivery and freight charges, installation, labor, etc.).
Most business tangible property (except vehicles and computer equipment) is assessed at 80% of the original cost for the first year of ownership and 10% less each succeeding year, until it reaches a floor of 20% in the seventh year, as follows:
- 1st year of ownership is assessed at 80% of original cost
- 2nd year of ownership is assessed at 70% of original cost
- 3rd year of ownership is assessed at 60% of original cost
- 4th year of ownership is assessed at 50% of original cost
- 5th year of ownership is assessed at 40% of original cost
- 6th year of ownership is assessed at 30% of original cost
- 7th year of ownership is assessed at 20% of original cost
Computer equipment is assessed at 50% of the original cost the first year and a varying percentage each year after that until the fifth year of ownership, as follows:
- 1st year of ownership is assessed at 50% of original cost
- 2nd year of ownership is assessed at 35% of original cost
- 3rd year of ownership is assessed at 20% of original cost
- 4th year of ownership is assessed at 10% of original cost
- 5th year of ownership is assessed at 2% of original cost
Most business vehicles are assessed based on the January 1 value in the January issue of the National Automobile Dealers Association (NADA) Used Car Guide. For trucks with a gross weight of over 14,000 pounds, the value is determined by the percentage of cost and the year it was purchased. Taxicabs are valued at 50% of the average loan value. The vehicle tax is prorated for the portion of the year that the vehicle is located in the County.
Tax Rate and Calculation
The current tax rate is $4.57 per $100 of assessed value. To calculate the tax on property assessed at $5,000, divide the assessed value by 100 and multiply by the tax rate:
You can pay your business tangible property taxes on your furniture, equipment, computers, machinery, tools, and business vehicles online. The due date for payment of business tangible property is October 5. The exceptions are business vehicles purchased or moved into the county on or after July 1, which have a due date of February 15 the following year. If the payment due date falls on a Saturday, Sunday, or county holiday, the due date is the following business day.
If you believe that your business tangible property has been over-assessed, you can appeal the assessment. For more information call 703-222-8234 (TTY 711).