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Overview: SIT Processing

SIT Processing in PACS

You can use special inventory tax (SIT) features in PACS Appraisal and PACS Collections to post sales and payments for SIT properties. You can also remove sales and payments and process sales increases from end-of-year declarations.

Further, you can apply escrow to a single property record, or you can apply escrow to multiple properties at the same time.

Lastly, use special inventory reports to review SIT escrow and payment data.

About the Special Inventory Tax

Texas law requires that dealers' inventory of heavy equipment & vehicles be appraised based on their prior year's total sales. Each January, dealers must file with the county appraisal district an inventory declaration listing the total value of inventory sold during the prior year. Also, the dealer must file with the county tax office a monthly form listing the inventory sold, and prepay their property taxes for each vehicle and/or piece of equipment. (Sales between dealers, sales that qualify as fleet transactions, and dealer financed subsequent sales are not subject to SIT.)

The current year's tax bills are received in October.

The Special Inventory Tax and the Appraisal District

Appraisal Districts must report the dealer data as follows:

Special Inventory Tax Calculations

The inventory’s market value is an average of the regular monthly sales from the preceding year: Current Year's Market Value = inventory sales amount / 12

The current year’s tax bills are based on this market value and the current year’s tax rates.

The taxes are assessed as follows:

The monthly tax prepayment to the tax office is calculated by applying the unit property tax factor to the value of each piece of equipment or vehicle sold in a month. A copy of the monthly tax statement is sent to the county appraisal district. The dealer pays all other tax bills to the taxing units.

The county tax assessor-collector pays the inventory tax bill to the taxing units from the escrow account after receiving the dealer’s December payment. The county tax collector pays the annual inventory taxes from the dealer’s escrow account and bills the dealer for any additional amount due.

Penalties

Not filing an inventory declaration with the appraisal district by January 31 is a misdemeanor subject to fines up to $500/day past the deadline, and $1,000 per month past the deadline, and additional penalties of $1,000 per month (or portion of a month not paid).