Kansas Taxes Certain Personal Property

Personal Property in Kansas Property Tax

In property tax, all taxable property falls into two broad categories: real property (land and buildings that are permanently attached) and personal property (movable assets not permanently affixed to the land). Many states have eliminated or significantly reduced personal property taxes, but Kansas continues to tax a variety of personal property categories.

What Personal Property Is Subject to Kansas Property Tax?

• Business Machinery and Equipment (Pre-2006) — Equipment used in business operations that was acquired before July 1, 2006, is subject to tax as it continues to be reported on depreciation schedules until depreciated to 20% residual. Equipment acquired after June 30, 2006, is generally exempt as CIME (see Slide 10).
• Containers and Freight Cars — Certain commercial containers and railroad freight cars that are present in Kansas on the assessment date may be subject to personal property taxation.
• Agricultural Machinery and Equipment (Exempt) — Most farm-use personal property — including tractors, combines, planters, tillage equipment, and other machinery and equipment used primarily in agricultural production — is exempt from Kansas personal property tax under K.S.A. 79-201j. This exemption is separate from the commercial CIME exemption and reflects the Legislature’s longstanding policy of relieving the tax burden on Kansas agricultural operations.

Valuation of Personal Property

Personal property in Kansas is generally valued using one of the following methods:

• State-Published Valuation Guides — The Kansas Department of Revenue publishes annual valuation guides used to value specific categories of personal property, such as oil and gas equipment.
• Rendition-Based Reporting — Business taxpayers may be required to file annual personal property renditions (declarations) listing their taxable property. The county appraiser uses this information to determine assessed value.
• Cost Less Depreciation — For machinery and equipment, the original cost is depreciated over time using Kansas-prescribed schedules to estimate current fair market value.

Assessment Rate and Reporting

Kansas businesses should work closely with their county appraiser and tax advisors to ensure personal property is correctly identified, reported, and — where applicable — properly claimed as exempt under the CIME provisions.