We may repeatedly wonder why we should pay taxes on our income or property if all we have obtained them thanks to our work. It is as if we had “to pay” the government to let us have our things, but the reality is different. Most of the income from tax collection is used for financing public services or other government services. This way, you can see the money you pay reflected in the general operations of your city.
Understanding how this type of assessment and collection works is not as difficult as people usually see it. You simply need to have knowledge of the basic concepts.
In this article, we have collected very useful information specifically about personal property taxes in Arkansas. So, if it is of your interest, continue reading and do not miss anything!
Personal Property Tax VS. Real Property Tax
First, we consider it appropriate to explain the types of property that exist in the legislation of this state since, without this valuable information, you can get confused and make a mistake in your declaration. In accordance with the regulations or standards established in the Arkansas Code 26-1-101, property taxes are based on two types: a) Personal Property Tax and b) Real Property Tax.
In many states of our country, there is no such difference, but in Arkansas, there are two kinds of property, and here is the difference between them.
- Personal Property. When we say personal property, according to the Arkansas Code, it refers to things that are tangible, animated, or inanimate, subject to ownership, and the most important characteristic: these things are easily movable. It means that personal property is everything a person can legally own. For a better understanding, those things can be cars, motorcycles, livestock, boats, etc.
- Real Property. On the other hand, real property are those real estate fixed, tangible, subject to ownership, and the most important aspect, they aren’t easy to move. This term is used to refer to lands and every improvement or structure made to those lands, such as buildings, homes, or malls. It’s also used for mobile homes or barns.
With that being said, what you need to remember is the main difference between these two property terms or types. One of them refers to things that are easy to move (like cars and motorcycles), and the other is used to refer to your house, apartment, or barn that is certainly not easy to move or rather, impossible to move.
Pay your Personal Property Tax Online
Once you know what this term means, it’s time to know how to calculate and pay your personal property tax in Arkansas.
The first thing you should know is who you should pay. Although by saying “personal property tax in Arkansas” you can infer that you must pay the government authorities, this type of tax is collected by counties and not at a state level. Thus, each county will indicate to its inhabitants how, when, and where to pay their personal property taxes.
- In Arkansas, usually, personal property taxes are due between January 1st and May 31st.
- Almost all counties offer online services for taxpayers to carry out their paperwork and payments through official websites.
For example, if you live in Conway County, you can access their Tax Collector ePayment Service Site and press the green button “get started”. To pay your taxes online, you must enter your Taxpayer ID Number, name, or street address and then click on “search”.
The same happens if you live in Crawford County, click here and enter your basic information (full name and address) and find your Personal Property Tax in Arkansas.
READ MORE: How to get Arkansas Snap Benefits.
How Do I Calculate My Personal Property Tax in Arkansas?
To know the Personal Property Tax you owe, you need to make some math calculations:
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Calculate your Assessed Value
This is the taxable value of your property. In Arkansas, every personal property is assessed 20% of market value. To calculate your assessed property value, use this formula:
Usual selling price of personal property x 20% of market price = Assessed value of your personal property.
Since you may have several cars or you have a car and a motorcycle, the correct way to do the calculation is by multiplying the usual selling price of each of your personal property by 20% of the market price. You should not add up all the usual selling prices and then multiply it by 20% of the market price. It is an individual calculation.
Once you have the assessed value of your personal property, you can add them together.
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Calculate Property Tax Owed
By now, you already have the assessed value of your personal property but we need to calculate how much taxes you owe for having that property.
The calculation is pretty simple, you only have to multiply the assessed value by your personal property millage rate.
But what does the millage rate mean? A millage rate is a taxing unit used to determine how much taxes you have to pay. Its value is 1/1000 of a dollar. This means a millage rate is an amount you have to pay per each $ 1,000 of the assessed value of your personal property.
In Arkansas taxpayers are typically levied with three types of tax rates or millage rates:
- County property tax rate
- School District tax rate
- City Property tax rate or No City Property tax rate.
Those rates vary from county to county, you have to search for the ones where you live. For example, here you can see the rates of Saline County.
Now that you’ve understood the basic terms, you can do your calculation in order to get your property tax owed.
Assessed value of your personal property x Personal property millage rate = Personal property tax owed.