Idaho ~ Property Tax: Pre-Tax Repossession and Sale of Property by High-Value Security Interest Holder Addressed

Recently enacted Idaho legislation addresses a taxpayer’s repossession and sale of personal property before the payment of the applicable tax where the taxpayer holds a high-value purchase money security interest. Specifically, if a taxpayer holding a purchase money security interest wants to repossess and sell a specific piece of personal property, and the market value of that personal property exceeds $20,000, then that taxpayer must provide the local tax collector with a request to segregate that specific piece of personal property from the rest of the taxpayer’s taxable personal property. Along with this segregation request, the taxpayer holding the security interest must also provide the tax collector with a copy of the underlying security interest agreement.

Afterwards, the local county assessor must then determine, and provide the tax collector with, the market value of the segregated personal property for assessment purposes. The tax collector must subsequently calculate the total property tax due, including any delinquencies, late charges, accrued interest, costs incurred, and the estimated tax for the current year, relating to the segregated personal property.

Before taking possession of the segregated personal property or selling that property, the taxpayer holding the purchase money security interest must first remit to the tax collector all of the personal property tax owed, including any other applicable amounts due, that are attributable to the segregated personal property.

Finally, the segregation of specific personal property from the remaining taxable personal property does not affect the priority of the relevant tax lien on the remaining taxable personal property.

Ch. 307 (S.B. 1357), Laws 2012, effective July 1, 2012

AUTHOR

Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

All stories by: Wolters Kluwer Tax and Accounting