CHAPTER 23. APPRAISAL METHODS AND PROCEDURES - Texas Statutes

TAX CODE

TITLE 1. PROPERTY TAX CODE

SUBTITLE D. APPRAISAL AND ASSESSMENT

CHAPTER 23. APPRAISAL METHODS AND PROCEDURES

SUBCHAPTER A. APPRAISALS GENERALLY

Sec. 23.01. APPRAISALS GENERALLY. (a) Except as otherwise

provided by this chapter, all taxable property is appraised at

its market value as of January 1.

(b) The market value of property shall be determined by the

application of generally accepted appraisal methods and

techniques. If the appraisal district determines the appraised

value of a property using mass appraisal standards, the mass

appraisal standards must comply with the Uniform Standards of

Professional Appraisal Practice. The same or similar appraisal

methods and techniques shall be used in appraising the same or

similar kinds of property. However, each property shall be

appraised based upon the individual characteristics that affect

the property's market value, and all available evidence that is

specific to the value of the property shall be taken into account

in determining the property's market value.

Text of subsection as added by Acts 2009, 81st Leg., R.S., Ch.

619, Sec. 1

(c) Notwithstanding Section 1.04(7)(C), in determining the

market value of a residence homestead, the chief appraiser may

not exclude from consideration the value of other residential

property that is in the same neighborhood as the residence

homestead being appraised and would otherwise be considered in

appraising the residence homestead because the other residential

property:

(1) was sold at a foreclosure sale conducted in any of the three

years preceding the tax year in which the residence homestead is

being appraised and was comparable at the time of sale based on

relevant characteristics with other residence homesteads in the

same neighborhood; or

(2) has a market value that has declined because of a declining

economy.

Text of subsection as added by Acts 2009, 81st Leg., R.S., Ch.

1211, Sec. 1

(c) Notwithstanding any provision of this subchapter to the

contrary, if the appraised value of property in a tax year is

lowered under Subtitle F, the appraised value of the property as

finally determined under that subtitle is considered to be the

appraised value of the property for that tax year. In the

following tax year, the chief appraiser may not increase the

appraised value of the property unless the increase by the chief

appraiser is reasonably supported by substantial evidence when

all of the reliable and probative evidence in the record is

considered as a whole. If the appraised value is finally

determined in a protest under Section 41.41(a)(2) or an appeal

under Section 42.26, the chief appraiser may satisfy the

requirement to reasonably support by substantial evidence an

increase in the appraised value of the property in the following

tax year by presenting evidence showing that the inequality in

the appraisal of property has been corrected with regard to the

properties that were considered in determining the value of the

subject property. The burden of proof is on the chief appraiser

to support an increase in the appraised value of property under

the circumstances described by this subsection.

Text of subsection as added by Acts 2009, 81st Leg., R.S., Ch.

1405, Sec. 2

(c) The market value of a residence homestead shall be

determined solely on the basis of the property's value as a

residence homestead, regardless of whether the residential use of

the property by the owner is considered to be the highest and

best use of the property.

Acts 1979, 66th Leg., p. 2252, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1985, 69th Leg., ch. 823, Sec. 5, eff. Jan.

1, 1986; Acts 1997, 75th Leg., ch. 1039, Sec. 21, eff. Jan. 1,

1998.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

619, Sec. 1, eff. January 1, 2010.

Acts 2009, 81st Leg., R.S., Ch.

1211, Sec. 1, eff. January 1, 2010.

Acts 2009, 81st Leg., R.S., Ch.

1405, Sec. 2, eff. January 1, 2010.

Sec. 23.0101. CONSIDERATION OF ALTERNATE APPRAISAL METHODS. In

determining the market value of property, the chief appraiser

shall consider the cost, income, and market data comparison

methods of appraisal and use the most appropriate method.

Added by Acts 1997, 75th Leg., ch. 1039, Sec. 22, eff. Jan. 1,

1998. Amended by Acts 1999, 76th Leg., ch. 1295, Sec. 1, eff.

Jan. 1, 2000.

Sec. 23.011. COST METHOD OF APPRAISAL. If the chief appraiser

uses the cost method of appraisal to determine the market value

of real property, the chief appraiser shall:

(1) use cost data obtained from generally accepted sources;

(2) make any appropriate adjustment for physical, functional, or

economic obsolescence;

(3) make available to the public on request cost data developed

and used by the chief appraiser as applied to all properties

within a property category and may charge a reasonable fee to the

public for the data;

(4) clearly state the reason for any variation between generally

accepted cost data and locally produced cost data if the data

vary by more than 10 percent; and

(5) make available to the property owner on request all

applicable market data that demonstrate the difference between

the replacement cost of the improvements to the property and the

depreciated value of the improvements.

Added by Acts 1997, 75th Leg., ch. 1039, Sec. 22, eff. Jan. 1,

1998.

Sec. 23.012. INCOME METHOD OF APPRAISAL. (a) If the income

method of appraisal is the most appropriate method to use to

determine the market value of real property, the chief appraiser

shall:

(1) analyze comparable rental data available to the chief

appraiser or the potential earnings capacity of the property, or

both, to estimate the gross income potential of the property;

(2) analyze comparable operating expense data available to the

chief appraiser to estimate the operating expenses of the

property;

(3) analyze comparable data available to the chief appraiser to

estimate rates of capitalization or rates of discount; and

(4) base projections of future rent or income potential and

expenses on reasonably clear and appropriate evidence.

(b) In developing income and expense statements and cash-flow

projections, the chief appraiser shall consider:

(1) historical information and trends;

(2) current supply and demand factors affecting those trends;

and

(3) anticipated events such as competition from other similar

properties under construction.

Added by Acts 1997, 75th Leg., ch. 1039, Sec. 22, eff. Jan. 1,

1998. Amended by Acts 2003, 78th Leg., ch. 548, Sec. 1, eff. Jan.

1, 2004.

Sec. 23.013. MARKET DATA COMPARISON METHOD OF APPRAISAL. (a)

If the chief appraiser uses the market data comparison method of

appraisal to determine the market value of real property, the

chief appraiser shall use comparable sales data and shall adjust

the comparable sales to the subject property.

(b) A sale is not considered to be a comparable sale unless the

sale occurred within 24 months of the date as of which the market

value of the subject property is to be determined, except that a

sale that did not occur during that period may be considered to

be a comparable sale if enough comparable properties were not

sold during that period to constitute a representative sample.

(c) A sale of a comparable property must be appropriately

adjusted for any change in the market value of the comparable

property during the period between the date of the sale of the

comparable property and the date as of which the market value of

the subject property is to be determined.

(d) Whether a property is comparable to the subject property

shall be determined based on similarities with regard to

location, square footage of the lot and improvements, property

age, property condition, property access, amenities, views,

income, operating expenses, occupancy, and the existence of

easements, deed restrictions, or other legal burdens affecting

marketability.

Added by Acts 1997, 75th Leg., ch. 1039, Sec. 22, eff. Jan. 1,

1998. Amended by Acts 1999, 76th Leg., ch. 1295, Sec. 2, eff.

Jan. 1, 2000.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1211, Sec. 2, eff. January 1, 2010.

Sec. 23.014. EXCLUSION OF PROPERTY AS REAL PROPERTY. Except as

provided by Section 23.24(b), in determining the market value of

real property, the chief appraiser shall analyze the effect on

that value of, and exclude from that value the value of, any:

(1) tangible personal property, including trade fixtures;

(2) intangible personal property; or

(3) other property that is not subject to appraisal as real

property.

Added by Acts 2003, 78th Leg., ch. 548, Sec. 2, eff. Jan. 1,

2004.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1211, Sec. 2, eff. January 1, 2010.

Sec. 23.02. REAPPRAISAL OF PROPERTY DAMAGED IN NATURAL DISASTER

AREA. (a) The governing body of a taxing unit that is located

partly or entirely inside an area declared to be a natural

disaster area by the governor may authorize reappraisal of all

property damaged in the disaster at its market value immediately

after the disaster.

(b) If a taxing unit authorizes a reappraisal pursuant to this

section, the appraisal office shall complete the reappraisal as

soon as practicable. The appraisal office shall include on the

appraisal records, in addition to other information required or

authorized by law:

(1) the date of the disaster;

(2) the appraised value of the property after the disaster; and

(3) if the reappraisal is not authorized by all taxing units in

which the property is located, an indication of the taxing units

to which the reappraisal applies.

(c) A taxing unit that authorizes a reappraisal under this

section must pay the appraisal district all the costs of making

the reappraisal. If two or more taxing units provide for the

reappraisal in the same territory, each shall share the costs of

the reappraisal in that territory in the proportion the total

dollar amount of taxes imposed in that territory in the preceding

year bears to the total dollar amount of taxes all units

providing for reappraisal of that territory imposed in the

preceding year.

(d) If property damaged in a natural disaster is reappraised as

provided by this section, the governing body shall provide for

prorating the taxes on the property for the year in which the

disaster occurred. If the taxes are prorated, taxes due on the

property are determined as follows: the taxes on the property

based on its value on January 1 of that year are multiplied by a

fraction, the denominator of which is 365 and the numerator of

which is the number of days before the date the disaster

occurred; the taxes on the property based on its reappraised

value are multiplied by a fraction, the denominator of which is

365 and the numerator of which is the number of days, including

the date the disaster occurred, remaining in the year; and the

total of the two amounts is the amount of taxes on the property

for the year.

(e) Repealed by Acts 1983, 68th Leg., p. 4829, ch. 851, Sec. 28,

eff. Aug. 29, 1983.

Added by Acts 1981, 67th Leg., 1st C.S., p. 136, ch. 13, Sec. 57,

eff. Jan. 1, 1982. Amended by Acts 1983, 68th Leg., p. 4829, ch.

851, Sec. 28, eff. Aug. 29, 1983.

Sec. 23.03. COMPILATION OF LARGE PROPERTIES AND PROPERTIES

SUBJECT TO LIMITATION ON APPRAISED VALUE. Each year the chief

appraiser shall compile and send to the Texas Department of

Economic Development a list of properties in the appraisal

district that in that tax year:

(1) have a market value of $100 million or more; or

(2) are subject to a limitation on appraised value under Chapter

313.

Added by Acts 2001, 77th Leg., ch. 1505, Sec. 2, eff. Jan. 1,

2002.

SUBCHAPTER B. SPECIAL APPRAISAL PROVISIONS

Sec. 23.11. GOVERNMENTAL ACTION THAT CONSTITUTES TAKING. In

appraising private real property, the effect of a governmental

action on the market value of private real property as determined

in a suit or contested case filed under Chapter 2007, Government

Code, shall be taken into consideration by the chief appraiser in

determining the market value of the property.

Added by Acts 1995, 74th Leg., ch. 517, Sec. 3, eff. Sept. 1,

1995.

Sec. 23.12. INVENTORY. (a) Except as provided by Sections

23.121, 23.1241, 23.124, and 23.127, the market value of an

inventory is the price for which it would sell as a unit to a

purchaser who would continue the business. An inventory shall

include residential real property which has never been occupied

as a residence and is held for sale in the ordinary course of a

trade or business, provided that the residential real property

remains unoccupied, is not leased or rented, and produces no

income.

(b) The chief appraiser shall establish procedures for the

equitable and uniform appraisal of inventory for taxation. In

conjunction with the establishment of the procedures, the chief

appraiser shall:

(1) establish, publish, and adhere to one procedure for the

determination of the quantity of property held in inventory

without regard to the kind, nature, or character of the property

comprising the inventory; and

(2) apply the same enforcement, verification, and audit

procedures, techniques, and criteria to the discovery, physical

examination, or quantification of all inventories without regard

to the kind, nature, or character of the property comprising the

inventory.

(c) In appraising an inventory, the chief appraiser shall use

the information obtained pursuant to Subsection (b) of this

section and shall apply generally accepted appraisal techniques

in computing the market value as defined in Subsection (a) of

this section.

(d) Subsections (b) and (c) of this section apply only to an

inventory held for sale, lease, or rental.

(e) A person who owns an inventory to which Subsection (b) of

this section applies may bring an action to enjoin the chief

appraiser from certifying to a taxing unit any portion of the

appraisal roll that lists an inventory for which the chief

appraiser has not complied with the requirements of Subsection

(b) of this section.

(f) The owner of an inventory other than a dealer's motor

vehicle inventory as that term is defined by Section 23.121, a

dealer's heavy equipment inventory as that term is defined by

Section 23.1241, or a dealer's vessel and outboard motor

inventory as that term is defined by Section 23.124, or a retail

manufactured housing inventory as that term is defined by Section

23.127 may elect to have the inventory appraised at its market

value as of September 1 of the year preceding the tax year to

which the appraisal applies by filing an application with the

chief appraiser requesting that the inventory be appraised as of

September 1. The application must clearly describe the inventory

to which it applies and be signed by the owner of the inventory.

The application applies to the appraisal of the inventory in each

tax year that begins after the next August 1 following the date

the application is filed with the chief appraiser unless the

owner of the inventory by written notice filed with the chief

appraiser revokes the application or the ownership of the

inventory changes. A notice revoking the application is effective

for each tax year that begins after the next September following

the date the notice of revocation is filed with the chief

appraiser.

(g) Expired.

Acts 1979, 66th Leg., p. 2253, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1981, 67th Leg., 1st C.S., p. 137, ch. 13,

Sec. 58, eff. Jan. 1, 1982; Acts 1987, 70th Leg., ch. 590, Sec.

1, eff. Aug. 31, 1987; Acts 1989, 71st Leg., ch. 796, Sec. 16,

eff. Sept. 1, 1989; Acts 1993, 73rd Leg., ch. 672, Sec. 1, 2,

eff. Jan. 1, 1994; Acts 1995, 74th Leg., ch. 836, Sec. 1, 2, eff.

Jan. 1, 1996; Acts 1995, 74th Leg., ch. 945, Sec. 1, eff. Jan. 1,

1996; Acts 1997, 75th Leg., ch. 165, Sec. 31.01(73), eff. Sept.

1, 1997; Acts 1997, 75th Leg., ch. 1112, Sec. 1, eff. Jan. 1,

1998; Acts 1997, 75th Leg., ch. 1184, Sec. 1, eff. Jan. 1, 1998.

Sec. 23.121. DEALER'S MOTOR VEHICLE INVENTORY; VALUE. (a) In

this section:

(1) "Chief appraiser" means the chief appraiser for the

appraisal district in which a dealer's motor vehicle inventory is

located.

(2) "Collector" means the county tax assessor-collector in the

county in which a dealer's motor vehicle inventory is located.

(3) "Dealer" means a person who holds a dealer's general

distinguishing number issued by the Texas Department of Motor

Vehicles under the authority of Chapter 503, Transportation Code,

or who is legally recognized as a motor vehicle dealer pursuant

to the law of another state and who complies with the terms of

Section 152.063(f). The term does not include:

(A) a person who holds a manufacturer's license issued under

Chapter 2301, Occupations Code;

(B) an entity that is owned or controlled by a person who holds

a manufacturer's license issued under Chapter 2301, Occupations

Code; or

(C) a dealer whose general distinguishing number issued by the

Texas Department of Motor Vehicles under the authority of Chapter

503, Transportation Code, prohibits the dealer from selling a

vehicle to any person except a dealer.

(4) "Dealer's motor vehicle inventory" means all motor vehicles

held for sale by a dealer.

(5) "Dealer-financed sale" means the sale of a motor vehicle in

which the seller finances the purchase of the vehicle, is the

sole lender in the transaction, and retains exclusively the right

to enforce the terms of the agreement evidencing the sale.

(6) "Declaration" means the dealer's motor vehicle inventory

declaration form promulgated by the comptroller as required by

this section.

(7) "Fleet transaction" means the sale of five or more motor

vehicles from a dealer's motor vehicle inventory to the same

person within one calendar year.

(8) "Motor vehicle" means a towable recreational vehicle or a

fully self-propelled vehicle with at least two wheels which has

as its primary purpose the transport of a person or persons, or

property, whether or not intended for use on a public street,

road, or highway. The term does not include:

(A) a vehicle with respect to which the certificate of title has

been surrendered in exchange for a salvage certificate in the

manner provided by law; or

(B) equipment or machinery designed and intended to be used for

a specific work-related purpose other than the transporting of a

person or property.

(9) "Owner" means a dealer who owes current year vehicle

inventory taxes levied against a dealer's motor vehicle

inventory.

(10) "Person" means a natural person, corporation, partnership,

or other legal entity.

(11) "Sales price" means the total amount of money paid or to be

paid for the purchase of a motor vehicle as set forth as "sales

price" in the form entitled "Application for Texas Certificate of

Title" promulgated by the Texas Department of Motor Vehicles. In

a transaction that does not involve the use of that form, the

term means an amount of money that is equivalent, or

substantially equivalent, to the amount that would appear as

"sales price" on the Application for Texas Certificate of Title

if that form were involved.

(12) "Subsequent sale" means a dealer-financed sale of a motor

vehicle that, at the time of the sale, has been the subject of a

dealer-financed sale from the same dealer's motor vehicle

inventory in the same calendar year.

(13) "Total annual sales" means the total of the sales price

from every sale from a dealer's motor vehicle inventory for a

12-month period.

(14) "Towable recreational vehicle" means a nonmotorized vehicle

that is designed for temporary human habitation for recreational,

camping, or seasonal use and:

(A) is titled and registered with the Texas Department of Motor

Vehicles through the office of the collector;

(B) is permanently built on a single chassis;

(C) contains one or more life support systems; and

(D) is designed to be towable by a motor vehicle.

(b) For the purpose of the computation of property tax, the

market value of a dealer's motor vehicle inventory on January 1

is the total annual sales from the dealer's motor vehicle

inventory, less sales to dealers, fleet transactions, and

subsequent sales, for the 12-month period corresponding to the

prior tax year, divided by 12.

(c) For the purpose of the computation of property tax, the

market value of the dealer's motor vehicle inventory of an owner

who was not a dealer on January 1 of the prior tax year, the

chief appraiser shall estimate the market value of the dealer's

motor vehicle inventory. In making the estimate required by this

subsection the chief appraiser shall extrapolate using sales

data, if any, generated by sales from the dealer's motor vehicle

inventory in the prior tax year.

(d) Except for dealer's motor vehicle inventory, personal

property held by a dealer is appraised as provided by other

sections of this code. In the case of a dealer whose sales from

dealer's motor vehicle inventory are made predominately to

dealers, the chief appraiser shall appraise the dealer's motor

vehicle inventory as provided by Section 23.12 of this code.

(e) A dealer is presumed to be an owner of a dealer's motor

vehicle inventory on January 1 if, in the 12-month period ending

on December 31 of the immediately preceding year, the dealer sold

a motor vehicle to a person other than a dealer. The presumption

created by this subsection is not rebutted by the fact that a

dealer has no motor vehicles physically on hand for sale from

dealer's motor vehicle inventory on January 1.

(f) The comptroller shall promulgate a form entitled Dealer's

Motor Vehicle Inventory Declaration. Except as provided by

Section 23.122(l), not later than February 1 of each year, or, in

the case of a dealer who was not in business on January 1, not

later than 30 days after commencement of business, each dealer

shall file a declaration with the chief appraiser and file a copy

with the collector. For purposes of this subsection, a dealer is

presumed to have commenced business on the date of issuance to

the dealer of a dealer's general distinguishing number as

provided by Chapter 503, Transportation Code. Notwithstanding

the presumption created by this subsection, a chief appraiser

may, at his or her sole discretion, designate as the date on

which a dealer commenced business a date other than the date of

issuance to the dealer of a dealer's general distinguishing

number. The declaration is sufficient to comply with this

subsection if it sets forth the following information:

(1) the name and business address of each location at which the

dealer owner conducts business;

(2) each of the dealer's general distinguishing numbers issued

by the Texas Department of Motor Vehicles;

(3) a statement that the dealer owner is the owner of a dealer's

motor vehicle inventory; and

(4) the market value of the dealer's motor vehicle inventory for

the current tax year as computed under Section 23.121(b).

(g) Under the terms provided by this subsection, the chief

appraiser may examine the books and records of the holder of a

general distinguishing number issued by the Texas Department of

Motor Vehicles. A request made under this subsection must be

made in writing, delivered personally to the custodian of the

records, at the location for which the general distinguishing

number has been issued, must provide a period not less than 15

days for the person to respond to the request, and must state

that the person to whom it is addressed has the right to seek

judicial relief from compliance with the request. In a request

made under this section the chief appraiser may examine:

(1) the document issued by the Texas Department of Motor

Vehicles showing the person's general distinguishing number;

(2) documentation appropriate to allow the chief appraiser to

ascertain the applicability of this section and Section 23.122 to

the person;

(3) sales records to substantiate information set forth in the

dealer's declaration filed by the person.

(h) If a dealer fails to file a declaration as required by this

section, or if, on the declaration required by this section, a

dealer reports the sale of fewer than five motor vehicles in the

prior year, the chief appraiser shall report that fact to the

Texas Department of Motor Vehicles and the department shall

initiate termination proceedings. The chief appraiser shall

include with the report a copy of a declaration, if any,

indicating the sale by a dealer of fewer than five motor vehicles

in the prior year. A report by a chief appraiser to the Texas

Department of Motor Vehicles as provided by this subsection is

prima facie grounds for the cancellation of the dealer's general

distinguishing number under Section 503.038(a)(9), Transportation

Code, or for refusal by the Texas Department of Motor Vehicles to

renew the dealer's general distinguishing number.

(i) A dealer who fails to file a declaration required by this

section commits an offense. An offense under this subsection is a

misdemeanor punishable by a fine not to exceed $500. Each day

during which a dealer fails to comply with the terms of this

subsection is a separate violation.

(j) A dealer who violates Subsection (g) of this section commits

an offense. An offense under this subsection is a misdemeanor

punishable by a fine not to exceed $500. Each day during which a

person fails to comply with the terms of Subsection (g) of this

section is a separate violation.

(k) In addition to other penalties provided by law, a dealer who

fails to file or fails to timely file a declaration required by

this section shall forfeit a penalty. A tax lien attaches to the

dealer's business personal property to secure payment of the

penalty. The appropriate district attorney, criminal district

attorney, county attorney, chief appraiser, or person designated

by the chief appraiser shall collect the penalty established by

this section in the name of the chief appraiser. Venue of an

action brought under this subsection is in the county in which

the violation occurred or in the county in which the owner

maintains the owner's principal place of business or residence.

A penalty forfeited under this subsection is $1,000 for each

month or part of a month in which a declaration is not filed or

timely filed after it is due.

Added by Acts 1993, 73rd Leg., ch. 672, Sec. 3, eff. Jan. 1,

1994. Renumbered from Tax Code Sec. 23.12A by Acts 1995, 74th

Leg., ch. 76, Sec. 17.01(46), eff. Sept. 1, 1995. Renumbered from

Tax Code Sec. 23.12A and amended by Acts 1995, 74th Leg., ch.

945, Sec. 2, eff. Jan. 1, 1996; Acts 1997, 75th Leg., ch. 165,

Sec. 30.249, eff. Sept. 1, 1997; Amended by Acts 1997, 75th Leg.,

ch. 321, Sec. 1 to 3, eff. May 26, 1997; Acts 1999, 76th Leg.,

ch. 1038, Sec. 1, eff. June 18, 1999.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

116, Sec. 1, eff. September 1, 2009.

Acts 2009, 81st Leg., R.S., Ch.

933, Sec. 3K.03, eff. September 1, 2009.

Acts 2009, 81st Leg., R.S., Ch.

933, Sec. 3K.04, eff. September 1, 2009.

Sec. 23.122. PREPAYMENT OF TAXES BY CERTAIN TAXPAYERS. (a) In

this section:

(1) "Aggregate tax rate" means the combined tax rates of all

relevant taxing units authorized by law to levy property taxes

against a dealer's motor vehicle inventory.

(2) "Chief appraiser" has the meaning given it in Section 23.121

of this code.

(3) "Collector" has the meaning given it in Section 23.121 of

this code.

(4) "Dealer's motor vehicle inventory" has the meaning given it

in Section 23.121 of this code.

(5) "Declaration" has the meaning given it in Section 23.121 of

this code.

(6) "Owner" has the meaning given it in Section 23.121 of this

code.

(7) "Relevant taxing unit" means a taxing unit, including the

county, authorized by law to levy property taxes against a

dealer's motor vehicle inventory.

(8) "Sales price" has the meaning given it in Section 23.121 of

this code.

(9) "Statement" means the Dealer's Motor Vehicle Inventory Tax

Statement filed on a form promulgated by the comptroller as

required by this section.

(10) "Subsequent sale" has the meaning given it in Section

23.121 of this code.

(11) "Total annual sales" has the meaning given it in Section

23.121 of this code.

(12) "Unit property tax factor" means a number equal to

one-twelfth of the prior year aggregate tax rate at the location

where a dealer's motor vehicle inventory is located on January 1

of the current year.

(b) Except for a vehicle sold to a dealer, a vehicle included in

a fleet transaction, or a vehicle that is the subject of a

subsequent sale, an owner or a person who has agreed by contract

to pay the owner's current year property taxes levied against the

owner's motor vehicle inventory shall assign a unit property tax

to each motor vehicle sold from a dealer's motor vehicle

inventory. The unit property tax of each motor vehicle is

determined by multiplying the sales price of the motor vehicle by

the unit property tax factor. On or before the 10th day of each

month the owner shall, together with the statement filed by the

owner as required by this section, deposit with the collector a

sum equal to the total of unit property tax assigned to all motor

vehicles sold from the dealer's motor vehicle inventory in the

prior month to which a unit property tax was assigned. The money

shall be deposited by the collector in or otherwise credited by

the collector to the owner's escrow account for prepayment of

property taxes as provided by this section. An escrow account

required by this section is used to pay property taxes levied

against the dealer's motor vehicle inventory, and the owner shall

fund the escrow account as provided by this subsection.

(c) The collector shall maintain the escrow account for each

owner in the county depository. The collector is not required to

maintain a separate account in the depository for each escrow

account created as provided by this section but shall maintain

separate records for each owner. The collector shall retain any

interest generated by the escrow account to defray the cost of

administration of the prepayment procedure established by this

section. Interest generated by an escrow account created as

provided by this section is the sole property of the collector,

and that interest may be used by no entity other than the

collector. Interest generated by an escrow account may not be

used to reduce or otherwise affect the annual appropriation to

the collector that would otherwise be made.

(d) The owner may not withdraw funds in an escrow account

created pursuant to this section.

(e) The comptroller shall promulgate a form entitled a Dealer's

Motor Vehicle Inventory Tax Statement. Each month, a dealer

shall complete the form regardless of whether a motor vehicle is

sold. A dealer may use no other form for that purpose. The

statement may include the information the comptroller deems

appropriate but shall include at least the following:

(1) a description of each motor vehicle sold;

(2) the sales price of the motor vehicle;

(3) the unit property tax of the motor vehicle if any; and

(4) the reason no unit property tax is assigned if no unit

property tax is assigned.

(f) On or before the 10th day of each month a dealer shall file

with the collector the statement covering the sale of each motor

vehicle sold by the dealer in the prior month. On or before the

10th day of a month following a month in which a dealer does not

sell a motor vehicle, the dealer must file the statement with the

collector and indicate that no sales were made in the prior

month. A dealer shall file a copy of the statement with the

chief appraiser and retain documentation relating to the

disposition of each motor vehicle sold. A chief appraiser or

collector may examine documents held by a dealer as required by

this subsection in the same manner, and subject to the same

provisions, as are set forth in Section 23.121(g).

(g) The requirements of Subsection (f) of this section apply to

all dealers, without regard to whether or not the dealer owes

vehicle inventory tax for the current year. A dealer who owes no

vehicle inventory tax for the current year because he was not in

business on January 1 may neither assign a unit property tax to a

motor vehicle sold by the dealer nor remit money with the

statement unless pursuant to the terms of a contract as provided

by Subsection (l) of this section.

(h) A collector may establish a procedure, voluntary or

mandatory, by which the unit property tax of a vehicle is paid

and deposited into an owner's escrow account at the time of

processing the transfer of title to the motor vehicle.

(i) A relevant taxing unit shall, on its tax bill prepared for

the owner of a dealer's motor vehicle inventory, separately

itemize the taxes levied against the dealer's motor vehicle

inventory. When the tax bill is prepared by a relevant taxing

unit for a dealer's motor vehicle inventory, the assessor for the

relevant taxing unit, or an entity, if any, other than the

collector, that collects taxes on behalf of the taxing unit,

shall provide the collector a true and correct copy of the tax

bill sent to the owner, including taxes levied against the

dealer's motor vehicle inventory. The collector shall apply the

money in the owner's escrow account to the taxes imposed and

deliver a tax receipt to the owner. The collector shall apply the

amount to each relevant taxing unit in proportion to the amount

of taxes levied, and the assessor of each relevant taxing unit

shall apply the funds received from the collector to the taxes

owed by the owner.

(j) If the amount in the escrow account is not sufficient to pay

the taxes in full, the collector shall apply the money to the

taxes and deliver to the owner a tax receipt for the partial

payment and a tax bill for the amount of the deficiency together

with a statement that the owner must remit to the collector the

balance of the total tax due.

(k) The collector shall remit to each relevant taxing unit the

total amount collected by the collector in deficiency payments.

The assessor of each relevant taxing unit shall apply those funds

to the taxes owed by the owner. Taxes that are due but not

received by the collector on or before January 31 are delinquent.

Not later than February 15 the collector shall distribute to

relevant taxing units in the manner set forth in this section all

funds collected pursuant to the authority of this section and

held in escrow by the collector as provided by this section. This

section does not impose a duty on a collector to collect

delinquent taxes that the collector is not otherwise obligated by

law or contract to collect.

(l) A person who acquires the business or assets of an owner

may, by contract, agree to pay the current year vehicle inventory

taxes owed by the owner. The owner who owes the current year tax

and the person who acquires the business or assets of the owner

shall jointly notify the chief appraiser and the collector of the

terms of the agreement and of the fact that the purchaser has

agreed to pay the current year vehicle inventory taxes owed by

the selling dealer. The chief appraiser and the collector shall

adjust their records accordingly. Notwithstanding the terms of

Section 23.121 of this code, a person who agrees to pay current

year vehicle inventory taxes as provided by this subsection is

not required to file a declaration until the year following the

acquisition. This subsection does not relieve the selling owner

of tax liability.

(m) A dealer who fails to file a statement as required by this

section commits an offense. An offense under this subsection is a

misdemeanor punishable by a fine not to exceed $100. Each day

during which a dealer fails to comply with the terms of this

subsection is a separate violation.

(n) In addition to other penalties provided by law, a dealer who

fails to file or fails to timely file a statement as required by

this section shall forfeit a penalty. A tax lien attaches to the

dealer's business personal property to secure payment of the

penalty. The appropriate district attorney, criminal district

attorney, county attorney, collector, or person designated by the

collector shall collect the penalty established by this section

in the name of the collector. Venue of an action brought under

this subsection is in the county in which the violation occurred

or in the county in which the owner maintains the owner's

principal place of business or residence. A penalty forfeited

under this subsection is $500 for each month or part of a month

in which a statement is not filed or timely filed after it is

due.

(o) An owner who fails to remit unit property taxes due as

required by this section shall pay a penalty of five percent of

the amount due. If the amount is not paid within 10 days after

the due date, the owner shall pay an additional penalty of five

percent of the amount due. Notwithstanding the terms of this

section, unit property taxes paid on or before January 31 of the

year following the date on which they are due are not delinquent.

The collector, the collector's designated agent, or the county or

district attorney shall enforce the terms of this subsection. A

penalty under this subsection is in addition to any other penalty

provided by law if the owner's taxes are delinquent.

(p) Fines collected pursuant to the authority of this section

shall be deposited in the county depository to the credit of the

general fund. Penalties collected pursuant to the authority of

this section are the sole property of the collector, may be used

by no entity other than the collector, and may not be used to

reduce or otherwise affect the annual appropriation to the

collector that would otherwise be made.

Added by Acts 1993, 73rd Leg., ch. 672, Sec. 4, eff. Jan. 1,

1994. Renumbered from Tax Code Sec. 23.12B by Acts 1995, 74th

Leg., ch. 76, Sec. 17.01(47), eff. Sept. 1, 1995. Renumbered from

Tax Code Sec. 23.12B and amended by Acts 1995, 74th Leg., ch.

945, Sec. 3, eff. Jan. 1, 1996; Amended by Acts 1997, 75th Leg.,

ch. 321, Sec. 4 to 7, eff. May 26, 1997.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

116, Sec. 2, eff. September 1, 2009.

Sec. 23.123. DECLARATIONS AND STATEMENTS CONFIDENTIAL. (a) In

this section:

(1) "Collector" has the meaning given it in Section 23.122 of

this code.

(2) "Chief appraiser" has the meaning given it in Section 23.122

of this code.

(3) "Dealer" has the meaning given it in Section 23.121 of this

code.

(4) "Declaration" has the meaning given it in Section 23.122 of

this code.

(5) "Owner" has the meaning given it in Section 23.121 of this

code.

(6) "Statement" has the meaning given it in Section 23.122 of

this code.

(b) Except as provided by this section, a declaration or

statement filed with a chief appraiser or collector as required

by Section 23.121 or Section 23.122 of this code is confidential

and not open to public inspection. A declaration or statement and

the information contained in either may not be disclosed to

anyone except an employee of the appraisal office who appraises

the property or to an employee of the county tax

assessor-collector involved in the maintenance of the owner's

escrow account.

(c) Information made confidential by this section may be

disclosed:

(1) in a judicial or administrative proceeding pursuant to a

lawful subpoena;

(2) to the person who filed the declaration or statement or to

that person's representative authorized by the person in writing

to receive the information;

(3) to the comptroller or an employee of the comptroller

authorized by the comptroller to receive the information;

(4) to a collector or chief appraiser;

(5) to a district attorney, criminal district attorney or county

attorney involved in the enforcement of a penalty imposed

pursuant to Section 23.121 or Section 23.122;

(6) for statistical purposes if in a form that does not identify

specific property or a specific property owner;

(7) if and to the extent that the information is required for

inclusion in a public document or record that the appraisal or

collection office is required by law to prepare or maintain; or

(8) to the Texas Department of Motor Vehicles for use by that

department in auditing compliance of its licensees with

appropriate provisions of applicable law.

(d) A person who knowingly permits inspection of a declaration

or statement by a person not authorized to inspect the

declaration or statement or who discloses confidential

information contained in the declaration or statement to a person

not authorized to receive the information commits an offense. An

offense under this subsection is a Class B misdemeanor.

Added by Acts 1995, 74th Leg., ch. 945, Sec. 4, eff. Jan. 1,

1996. Amended by Acts 1999, 76th Leg., ch. 1038, Sec. 2, eff.

June 18, 1999.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

933, Sec. 3K.05, eff. September 1, 2009.

Sec. 23.124. DEALER'S VESSEL AND OUTBOARD MOTOR INVENTORY;

VALUE. (a) In this section:

(1) "Chief appraiser" means the chief appraiser for the

appraisal district in which a dealer's vessel and outboard motor

inventory is located.

(2) "Collector" means the county tax assessor-collector in the

county in which a dealer's vessel and outboard motor inventory is

located.

(3) "Dealer" means a person who holds a dealer's and

manufacturer's number issued by the Parks and Wildlife Department

under the authority of Section 31.041, Parks and Wildlife Code,

or is authorized by law or interstate reciprocity agreement to

purchase vessels or outboard motors in Texas without paying the

sales tax. The term does not include a person who is principally

engaged in manufacturing vessels or outboard motors or an entity

that is owned or controlled by such a person.

(4) "Dealer's vessel and outboard motor inventory" means all

vessels and outboard motors held for sale by a dealer.

(5) "Dealer-financed sale" means the sale of a vessel or

outboard motor in which the seller finances the purchase of the

vessel or outboard motor, is the sole lender in the transaction,

and retains exclusively the right to enforce the terms of the

agreement evidencing the sale.

(6) "Declaration" means the dealer's vessel and outboard motor

inventory declaration form promulgated by the comptroller as

required by this section.

(7) "Fleet transaction" means the sale of five or more vessels

or outboard motors from a dealer's vessel and outboard motor

inventory to the same business entity within one calendar year.

(8) "Outboard motor" has the meaning given it by Section 31.003,

Parks and Wildlife Code.

(9) "Owner" means a dealer who owes current year vessel and

outboard motor inventory taxes levied against a dealer's vessel

and outboard motor inventory.

(10) "Person" means a natural person, corporation, partnership,

or other legal entity.

(11) "Sales price" means the total amount of money paid or to be

paid for the purchase of:

(A) a vessel, other than a trailer that is treated as a vessel,

as set forth as "sales price" in the form entitled "Application

for Texas Certificate of Number/Title for Boat/Seller, Donor or

Trader's Affidavit" promulgated by the Parks and Wildlife

Department;

(B) an outboard motor as set forth as "sales price" in the form

entitled "Application for Texas Certificate of Title for an

Outboard Motor/Seller, Donor or Trader's Affidavit" promulgated

by the Parks and Wildlife Department; or

(C) a trailer that is treated as a vessel as set forth as "sales

price" in the form entitled "Application for Texas Certificate of

Title" promulgated by the Texas Department of Motor Vehicles.

In a transaction involving a vessel, an outboard motor, or a

trailer that is treated as a vessel that does not involve the use

of one of these forms, the term means an amount of money that is

equivalent, or substantially equivalent, to the amount that would

appear as "sales price" on the Application for Texas Certificate

of Number/Title for Boat/Seller, Donor or Trader's Affidavit, the

Application for Texas Certificate of Title for an Outboard

Motor/Seller, Donor or Trader's Affidavit, or the Application for

Texas Certificate of Title if one of these forms were involved.

(12) "Subsequent sale" means a dealer-financed sale of a vessel

or outboard motor that, at the time of the sale, has been the

subject of a dealer-financed sale from the same dealer's vessel

and outboard motor inventory in the same calendar year.

(13) "Total annual sales" means the total of the sales price

from every sale from a dealer's vessel and outboard motor

inventory for a 12-month period.

(14) "Vessel" has the meaning given it by Section 31.003, Parks

and Wildlife Code, except such term shall not include:

(A) vessels of more than 65 feet in length, measured from end to

end over the deck, excluding sheer; and

(B) canoes, kayaks, punts, rowboats, rubber rafts, or other

vessels under 14 feet in length when paddled, poled, oared, or

windblown.

The term "vessel" also includes trailers that are treated as

vessels as defined in this section.

(15) "Trailer treated as a vessel" means a vehicle that:

(A) is designed to carry a vessel; and

(B) is either a "trailer" or "semitrailer" as such terms are

defined by Section 501.002, Transportation Code.

(b) For the purpose of the computation of property tax, the

market value of a dealer's vessel and outboard motor inventory on

January 1 is the total annual sales from the dealer's vessel and

outboard motor inventory, less sales to dealers, fleet

transactions, and subsequent sales, for the 12-month period

corresponding to the prior tax year, divided by 12.

(c) For the purpose of the computation of property tax on the

market value of a dealer's vessel and outboard motor inventory of

an owner who was not a dealer on January 1 of the prior tax year,

the chief appraiser shall estimate the market value of the

dealer's vessel and outboard motor inventory. In making the

estimate required by this subsection, the chief appraiser shall

extrapolate using sales data, if any, generated by sales from the

dealer's vessel and outboard motor inventory in the prior tax

year.

(d) Except for the dealer's vessel and outboard motor inventory,

personal property held by a dealer is appraised as provided by

other sections of this code. In the case of a dealer whose sales

from the dealer's vessel and outboard motor inventory are made

predominantly to dealers, the chief appraiser shall appraise the

dealer's vessel and outboard motor inventory as provided by

Section 23.12 of this code.

(e) A dealer is presumed to be an owner of a dealer's vessel and

outboard motor inventory on January 1 if, in the 12-month period

ending on December 31 of the immediately preceding year, the

dealer sold a vessel or outboard motor to a person other than a

dealer. The presumption created by this subsection is not

rebutted by the fact that a dealer has no vessels or outboard

motors physically on hand for sale from a dealer's vessel and

outboard motor inventory on January 1.

(f) The comptroller shall promulgate a form entitled "Dealer's

Vessel and Outboard Motor Inventory Declaration." Except as

provided by Section 23.125(l) of this code, not later than

February 1 of each year or, in the case of a dealer who was not

in business on January 1, not later than 30 days after

commencement of business, each dealer shall file a declaration

with the chief appraiser and file a copy with the collector. The

declaration is sufficient to comply with this subsection if it

sets forth the following information:

(1) the name and business address of each location at which the

dealer owner conducts business;

(2) each of the dealer's and manufacturer's numbers issued by

the Parks and Wildlife Department;

(3) a statement that the dealer owner is the owner of a dealer's

vessel and outboard motor inventory; and

(4) the market value of the dealer's vessel and outboard motor

inventory for the current tax year as computed under Subsection

(b) of this section.

(g) Under the terms provided by this subsection, the chief

appraiser may examine the books and records of the holder of a

dealer's and manufacturer's number issued by the Parks and

Wildlife Department. A request made under this subsection must be

made in writing, delivered personally to the custodian of the

records, must provide a period not less than 15 days for the

person to respond to the request, and must state that the person

to whom it is addressed has the right to seek judicial relief

from compliance with the request. In a request made under this

section the chief appraiser may examine:

(1) the document issued by the Parks and Wildlife Department

showing the person's dealer's and manufacturer's number;

(2) documentation appropriate to allow the chief appraiser to

ascertain the applicability of this section and Section 23.125 of

this code to the person;

(3) sales records to substantiate information set forth in the

dealer's declaration filed by the person.

(h) If a dealer fails to file a declaration required by this

section, or if, on the declaration required by this section, a

dealer reports the sale of fewer than five vessels or outboard

motors in the prior year, the chief appraiser shall report that

fact to the Parks and Wildlife Department.

(i) A dealer who fails to file a declaration required by this

section commits an offense. An offense under this subsection is a

misdemeanor punishable by a fine not to exceed $500. Each day

during which a dealer fails to comply with the terms of this

subsection is a separate violation.

(j) A dealer who violates Subsection (g) of this section commits

an offense. An offense under this subsection is a misdemeanor

punishable by a fine not to exceed $500. Each day during which a

dealer fails to comply with the terms of Subsection (g) of this

section is a separate violation.

(k) In addition to other penalties provided by law, a dealer who

fails to file or fails to timely file a declaration required by

this section shall forfeit a penalty. A tax lien attaches to the

dealer's business personal property to secure payment of the

penalty. The appropriate district attorney, criminal district

attorney, or county attorney shall collect the penalty

established by this section in the name of the chief appraiser or

collector. Venue of an action brought under this subsection is

in the county in which the violation occurred or in the county in

which the owner maintains the owner's principal place of business

or residence. A penalty forfeited under this subsection is

$1,000 for each month or part of a month in which a declaration

is not filed or timely filed after it is due.

Added by Acts 1995, 74th Leg., ch. 836, Sec. 3, eff. Jan. 1,

1996. Renumbered from Tax Code Sec. 23.12D by Acts 1997, 75th

Leg., ch. 165, Sec. 31.01(73), eff. Sept. 1, 1997. Amended by

Acts 1997, 75th Leg., ch. 1052, Sec. 1, 2, eff. Jan. 1, 1998.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

116, Sec. 3, eff. September 1, 2009.

Acts 2009, 81st Leg., R.S., Ch.

933, Sec. 3K.06, eff. September 1, 2009.

Sec. 23.1241. DEALER'S HEAVY EQUIPMENT INVENTORY; VALUE. (a)

In this section:

(1) "Dealer" means a person engaged in the business in this

state of selling heavy equipment.

(2) "Dealer's heavy equipment inventory" means all items of

heavy equipment that a dealer holds for sale at retail. The term

includes items of heavy equipment that are leased or rented but

subject to a purchase option by the lessee or renter.

(3) "Dealer-financed sale" means the sale at retail of an item

of heavy equipment in which the dealer finances the purchase of

the item, is the sole lender in the transaction, and retains

exclusively the right to enforce the terms of the agreement that

evidences the sale.

(4) "Declaration" means a dealer's heavy equipment inventory

declaration form adopted by the comptroller under this section.

(5) "Fleet transaction" means the sale of five or more items of

heavy equipment from a dealer's heavy equipment inventory to the

same person in one calendar year.

(6) "Heavy equipment" means self-propelled, self-powered, or

pull-type equipment, including farm equipment or a diesel engine,

that weighs at least 3,000 pounds and is intended to be used for

agricultural, construction, industrial, maritime, mining, or

forestry uses. The term does not include a motor vehicle that is

required by:

(A) Chapter 501, Transportation Code, to be titled; or

(B) Chapter 502, Transportation Code, to be registered.

(7) "Sales price" means:

(A) the total amount of money paid or to be paid to a dealer for

the purchase of an item of heavy equipment; or

(B) for a lease or rental with an option to purchase, the total

amount of the lease or rental payments plus any final

consideration, excluding interest.

(8) "Subsequent sale" means a dealer-financed sale of an item of

heavy equipment that, at the time of the sale, has been the

subject of a dealer-financed sale from the same dealer's heavy

equipment inventory in the same calendar year.

(9) "Total annual sales" means the total of the sales price for

each sale from a dealer's heavy equipment inventory in a 12-month

period.

(b) For the purpose of the computation of property tax:

(1) the market value of a dealer's heavy equipment inventory on

January 1 is the total annual sales, less sales to dealers, fleet

transactions, and subsequent sales, for the 12-month period

corresponding to the preceding tax year, divided by 12; and

(2) a sale is considered to occur when possession of an item of

heavy equipment is transferred from the dealer to the purchaser.

(c) For the purpose of the computation of property tax on the

market value of the dealer's heavy equipment inventory of an

owner who was not a dealer on January 1 of the preceding tax

year, the chief appraiser shall estimate the market value of the

dealer's heavy equipment inventory. In making the estimate

required by this subsection, the chief appraiser shall

extrapolate using sales data, if any, generated by sales from the

dealer's heavy equipment inventory in the preceding tax year.

(d) Except for dealer's heavy equipment inventory, personal

property held by a dealer is appraised as provided by the other

sections of this code. In the case of a dealer whose sales from

the dealer's heavy equipment inventory are made predominately to

other dealers, the chief appraiser shall appraise the dealer's

heavy equipment inventory as provided by Section 23.12.

(e) A dealer is presumed to be an owner of a dealer's heavy

equipment inventory on January 1 if, in the 12-month period

ending on December 31 of the preceding year, the dealer sold an

item of heavy equipment to a person other than a dealer. The

presumption is not rebutted by the fact that a dealer has no item

of heavy equipment physically on hand for sale from the dealer's

heavy equipment inventory on January 1.

(f) The comptroller by rule shall adopt a dealer's heavy

equipment inventory declaration form. Except as provided by

Section 23.1242(k), not later than February 1 of each year, or,

in the case of a dealer who was not in business on January 1, not

later than 30 days after commencement of business, each dealer

shall file a declaration with the chief appraiser and file a copy

with the collector. The declaration is sufficient to comply with

this subsection if it sets forth:

(1) the name and business address of each location at which the

declarant conducts business;

(2) a statement that the declarant is the owner of a dealer's

heavy equipment inventory; and

(3) the market value of the declarant's heavy equipment

inventory for the current tax year as computed under Subsection

(b).

(g) As provided by this subsection, the chief appraiser may

examine the books and records of a dealer. A request made under

this subsection must be made in writing, must be delivered

personally to the custodian of the records at a location at which

the dealer conducts business, must provide a period of not less

than 15 days for the person to respond to the request, and must

state that the person to whom the request is addressed has the

right to seek judicial relief from compliance with the request.

In a request made under this section, the chief appraiser may

examine:

(1) documentation appropriate to allow the chief appraiser to

ascertain the applicability of this section and Section 23.1242

to the person; and

(2) sales records to substantiate information set forth in the

declaration filed by the dealer.

(h) Repealed by Acts 1999, 76th Leg., ch. 574, Sec. 2(1), eff.

June 18, 1999.

(i) A dealer who fails to file a declaration as required by

Subsection (f) commits an offense. An offense under this

subsection is a misdemeanor punishable by a fine not to exceed

$500. Each day that a person fails to file the declaration as

required by Subsection (f) is a separate violation.

(j) In addition to other penalties provided by law, a dealer who

fails to file or fails to timely file a declaration required by

Subsection (f) shall forfeit a penalty. A tax lien attaches to

the dealer's business personal property to secure payment of the

penalty. The appropriate district attorney, criminal district

attorney, or county attorney shall collect the penalty

established by this section in the name of the chief appraiser or

collector. Venue of an action brought under this subsection is

in the county in which the violation occurred or in the county in

which the owner maintains the owner's principal place of business

or residence. A penalty forfeited under this subsection is

$1,000 for each month or part of a month in which a declaration

is not filed or timely filed after it is due.

Added by Acts 1997, 75th Leg., ch. 1184, Sec. 2, eff. Jan. 1,

1998. Amended by Acts 1999, 76th Leg., ch. 574, Sec. 2(1), eff.

June 18, 1999; Acts 1999, 76th Leg., ch. 1550, Sec. 1 to 3, eff.

Jan. 1, 2000.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

116, Sec. 4, eff. September 1, 2009.

Sec. 23.1242. PREPAYMENT OF TAXES BY HEAVY EQUIPMENT DEALERS.

(a) In this section:

(1) "Aggregate tax rate" means the combined tax rates of all

appropriate taxing units authorized by law to levy property taxes

against a dealer's heavy equipment inventory.

(2) "Dealer's heavy equipment inventory," "declaration,"

"dealer," "sales price," "subsequent sale," and "total annual

sales" have the meanings assigned those terms by Section 23.1241.

(3) "Statement" means the dealer's heavy equipment inventory tax

statement filed on a form adopted by the comptroller under this

section.

(4) "Unit property tax factor" means a number equal to

one-twelfth of the preceding year's aggregate ad valorem tax rate

at the location where a dealer's heavy equipment inventory is

located on January 1 of the current year.

(b) Except for an item of heavy equipment sold to a dealer, an

item of heavy equipment included in a fleet transaction, or an

item of heavy equipment that is the subject of a subsequent sale,

an owner or a person who has agreed by contract to pay the

owner's current year property taxes levied against the owner's

heavy equipment inventory shall assign a unit property tax to

each item of heavy equipment sold from a dealer's heavy equipment

inventory. The unit property tax o