BEFORE THE DEPARTMENT OF REVENUE

OF THE STATE OF MONTANA

 

In the matter of the amendment of ARM 42.21.113, 42.21.123, 42.21.124, 42.21.131, 42.21.137, 42.21.138, 42.21.139, 42.21.140, 42.21.151, 42.21.153, 42.21.155, 42.21.165, and 42.22.1311 pertaining to the trended depreciation schedules for valuing property

) ) ) ) ) ) ) )

NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENT

 

TO: All Concerned Persons

 

1. On November 12, 2014, at 9 a.m., the Department of Revenue will hold a public hearing in the Third Floor Reception Area Conference Room of the Sam W. Mitchell Building, located at 125 North Roberts, Helena, Montana, to consider the proposed amendment of the above-stated rules. The conference room is most readily accessed by entering through the east doors of the building.

 

2. The Department of Revenue will make reasonable accommodations for persons with disabilities who wish to participate in this public hearing or need an alternative accessible format of this notice. If you require an accommodation, please advise the department of the nature of the accommodation needed, no later than 5 p.m. on November 3, 2014. Please contact Laurie Logan, Department of Revenue, Director's Office, P.O. Box 7701, Helena, Montana 59604-7701; telephone (406) 444-7905; fax (406) 444-3696; or e-mail [email protected].

 

3. GENERAL STATEMENT OF REASONABLE NECESSITY.  The department uses data from the guides and valuation manuals listed in its rules to determine the trended depreciation schedules published in those rules.  Personal property is valued annually and because the trend tables used to value personal property change from year to year, the department must provide taxpayers with notice of those changes and does so through the rulemaking process.  The annual update to the trended depreciation schedules provides taxpayers with the current depreciation percentage for each of the personal property classifications for the upcoming year.  The updates also clearly identify for the taxpayer how the department values and depreciates property over time.

The department has considered the small business impact study requirements of 2-4-111, MCA, and determined the proposed amendments to the rules in this notice will not significantly and directly impact small businesses. ARM 42.21.157 requires the department to update the depreciation schedules of tangible personal property on an annual basis. The annual changes to ARM 42.21.113, 42.21.123, 42.21.131, 42.21.137, 42.21.138, 42.21.139, 42.21.140, 42.21.155, and 42.21.1311, affect all businesses with tangible personal property.  By annually updating the depreciation schedules, the department accounts for the impact an additional year of wear and tear has on the value of tangible personal property.  Small businesses would see a negative impact if these tables were not updated.

It is reasonably necessary to update the trend tables to reflect any changes for the upcoming year.  This general statement of reasonable necessity applies to all of the following proposed amendments, and has been supplemented as appropriate for any additional proposed rule change.

 

4. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:

 

42.21.113 LEASED AND RENTAL EQUIPMENT  (1) Leased or rental equipment that is leased or rented on an hourly, daily, weekly, semimonthly, or monthly basis, but is not exempt under 15-6-202 or 15-6-219, MCA, will be valued in the following manner:

(a) For equipment that has an acquired cost of $0 to $500, the department shall use a four-year trended depreciation schedule. The trended schedule will be the same as ARM 42.21.155, category 1.

 

YEAR NEW/ACQUIRED	TRENDED % GOOD
2013 2014	70%
2012 2013	43 44%
2011 2012	18 19%
2010 2011 and older	8 9%

 

(b) For equipment that has an acquired cost of $501 to $1,500, the department shall use a five-year trended depreciation schedule. The trended schedule will be the same as ARM 42.21.155, category 2.

 

YEAR NEW/ACQUIRED	TRENDED % GOOD
2013 2014	85%
2012 2013	66 69%
2011 2012	51 50%
2010 2011	33%
2009 2010 and older	22%

 

(c) For equipment that has an acquired cost of $1,501 to $5,000, the department shall use a ten-year trended depreciation schedule. The trended schedule will be the same as ARM 42.21.155, category 8.

 

YEAR NEW/ACQUIRED	TRENDED % GOOD
2013 2014	92%
2012 2013	84 85%
2011 2012	78 77%
2010 2011	70%
2009 2010	61%
2008 2009	55 52%
2007 2008	44%
2006 2007	35%
2005 2006	29 28%
2004 2005 and older	26%

 

(d) For equipment that has an acquired cost of $5,001 to $15,000, the department shall use the trended depreciation schedule for heavy equipment. The schedule will be the same as ARM 42.21.131.

 

YEAR NEW/ACQUIRED	TRENDED % GOOD
2014 2015	80%
2013 2014	65%
2012 2013	57 62%
2011 2012	57 58%
2010 2011	54 52%
2009 2010	48 49%
2008 2009	43%
2007 2008	40%
2006 2007	36 37%
2005 2006	32 34%
2004 2005	30 33%
2003 2004	23 32%
2002 2003	22 29%
2001 2002	23 27%
2000 2001	24 25%
1999 2000	19 23%
1998 1999	21 22%
1997 1998	20 21%
1996 1997	20 21%
1995 1996 and older	15 19%

 

(e) For rental video tapes and digital video disks, the following trended depreciation schedule will be used:

 

YEAR NEW/ACQUIRED	TRENDED % GOOD
2013 2014	25%
2012 2013	15%
2011 2012 and older	10%

 

(2) through (4) remain the same.

(5) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, 15-23-108, MCA

IMP: 15-6-135, 15-6-138, 15-6-202, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.113 to strike an incorrect implementing statute.

42.21.123 FARM MACHINERY AND EQUIPMENT (1) through (7) remain the same.

(8) The trended depreciation schedule referred to in (2) through (6) is listed below and shall be used for tax year 2014 2015. The schedule is derived by using the guidebook listed in (2) as the data base. The values derived through use of the trended depreciation schedule will approximate average wholesale value.

 

YEAR NEW/ACQUIRED	TRENDED % GOOD AVERAGE WHOLESALE
2014 2015	80%
2013 2014	75%
2012 2013	66%
2011 2012	64 61%
2010 2011	61 58%
2009 2010	54 55%
2008 2009	53 48%
2007 2008	51 48%
2006 2007	48 47%
2005 2006	44%
2004 2005	43 41%
2003 2004	38 39%
2002 2003	33 35%
2001 2002	31%
2000 2001	29 28%
1999 2000	27%
1998 1999 and older	22 21%

 

(9) remains the same.

(10) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

42.21.124 PER CAPITA LIVESTOCK TAX REPORTING PROCEDURE

(1) For purposes of assessing the per capita tax fees on livestock, poultry, and bees to pay the expense of enforcing the livestock, poultry, and bee laws, the following categories of livestock, poultry, and bees shall be used by the producer to report the number of animals within each category. The established categories are:

(a) through (j) remain the same.

(2) This rule is effective for tax years beginning after December 31, 1997 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-207, 15-24-921, 15-24-922, 15-24-925, MCA

 

REASONABLE NECESSITY: The department proposes amending ARM 42.21.124 to correctly identify the per capita fee as a fee, rather than a tax, and to update the year referenced in (2).

 

42.21.131 HEAVY EQUIPMENT (1) through (4) remain the same.

(5) The trended depreciation schedule referred to in (2), (3), and (4) is listed below and shall be used for tax year 2014 2015. The values derived through the use of these percentages approximate the "quick sale" values as calculated in the guidebooks listed in (1).

 

HEAVY EQUIPMENT TRENDED DEPRECIATION SCHEDULE
YEAR NEW/ACQUIRED	TRENDED % GOOD WHOLESALE
2014 2015	80%
2013 2014	65%
2012 2013	57 62%
2011 2012	57 58%
2010 2011	54 52%
2009 2010	48 49%
2008 2009	43%
2007 2008	40%
2006 2007	36 37%
2005 2006	32 34%
2004 2005	30 33%
2003 2004	23 32%
2002 2003	22 29%
2001 2002	23 27%
2000 2001	24 25%
1999 2000	19 23%
1998 1999	21 22%
1997 1998	20 21%
1996 1997	20 21%
1995 1996 and older	15 19%

 

 

(6) This rule is effective for tax years beginning after December 31, 2013 2014, and applies to all heavy equipment. 

 

AUTH: 15-1-201, 15-23-108, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.131 to remove an unnecessary table header and to strike an incorrect implementing statute.

 

42.21.137 SEISMOGRAPH UNITS AND ALLIED EQUIPMENT

(1) through (3) remain the same.

(4) The trended depreciation schedules referred to in (1) through (3) are listed below and shall be used for tax year 2014 2015.

 

SEISMOGRAPH UNIT
YEAR NEW/ACQUIRED	% GOOD		TREND FACTOR	TRENDED % GOOD		WHOLESALE FACTOR		WHOLESALE % GOOD
2014 2015	100%		1.000	100%		80%		80%
2013 2014	85%		1.000	85%		80%		68%
2012 2013	69%		1.000 9	69 70%		80%		55 56%
2011 2012	52%		1.02710	53%		80%		43 42%
2010 2011	34%		1.05538	36 35%		80%		29 28%
2009 2010	23%		1.04066	24 25%		80%		19 20%
2008 2009-2006	18%		1.07751	19%		80%		16 15%
2005 and older	5%							5%
SEISMOGRAPH ALLIED EQUIPMENT
YEAR NEW/ ACQUIRED		% GOOD			TREND FACTOR		TRENDED % GOOD
2014 2015		100%			1.000		100%
2013 2014		85%			1.000		85%
2012 2013		69%			1.000 1.009		69 70%
2011 2012		52%			1.027 1.010		53%
2010 2011		34%			1.055 1.038		36 35%
2009 2010		23%			1.040 1.066		24 25%
2008 2009-2006		18%			1.077 1.051		19%
2005 and older		5%					5%

 

 (5) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.137 to strike an incorrect implementing statute.

 

42.21.138 OIL AND GAS FIELD MACHINERY AND EQUIPMENT 

(1) and (2) remain the same.

(3) The trended depreciation schedule referred to in (1) and (2) is listed below and shall be used for tax year 2014 2015.

 

OIL AND GAS FIELD PRODUCTION EQUIPMENT TRENDED DEPRECIATION SCHEDULE
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2014 2015	100%	1.000	100%
2013 2014	95%	1.000	95%
2012 2013	90%	1.000 1.009	90 91%
2011 2012	85%	1.027 1.010	87 86%
2010 2011	79%	1.055 1.038	83 82%
2009 2010	73%	1.040 1.066	76 78%
2008 2009	68%	1.077 1.051	73 71%
2007 2008	62%	1.125 1.088	70 67%
2006 2007	55%	1.192 1.137	66 63%
2005 2006	49%	1.252 1.204	61 59%
2004 2005	43%	1.358 1.265	58 54%
2003 2004	37%	1.406 1.372	52 51%
2002 2003	31%	1.434 1.420	44%
2001 2002	26%	1.442 1.449	37 38%
2000 2001	23%	1.456 1.457	33 34%
1999 2000 and older	21%	1.479 1.471	30 31%

 

(4) remains the same.

(5) Downhole equipment which is not in an oil or gas well as of the assessment date, January 1, each year shall be taxed as class eight property.

(6) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-213, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.138 to clearly set forth the assessment date for determining the taxable or exempt status of downhole equipment, and to remove an unnecessary table header.

 

42.21.139 WORK-OVER AND SERVICE RIGS (1) through (4) remain the same.

(5) The trended depreciation schedule referred to in (2) and (4) is listed below and shall be used for tax year 2014 2015.

 

SERVICE AND WORKOVER RIG TRENDED DEPRECIATION SCHEDULE
YEAR/NEW ACQUIRED	% GOOD	TREND FACTOR	WHOLESALE FACTOR	TRENDED WHOLESALE % GOOD
2014 2015	100%	1.000	80%	80%
2013 2014	92%	1.000	80%	74%
2012 2013	84%	1.000 1.009	80%	67 68%
2011 2012	76%	1.027 1.010	80%	62 61%
2010 2011	67%	1.055 1.038	80%	57 56%
2009 2010	58%	1.040 1.066	80%	48 49%
2008 2009	49%	1.077 1.051	80%	42 41%
2007 2008	39%	1.125 1.088	80%	35 34%
2006 2007	30%	1.192 1.137	80%	29 27%
2005 2006	24%	1.252 1.204	80%	24 23%
2004 2005 and older	21%	1.358 1.265	80%	22 21%

 

(6) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.139 to remove an unnecessary table header.

 

42.21.140 OIL DRILLING RIGS (1) remains the same.

(2) The department shall prepare a ten-year trended depreciation schedule for oil drilling rigs. The trended depreciation schedule shall be derived from depreciation factors published in the Marshall & Swift Valuation Service Guide. The "% good" for all drill rigs less than one year old shall be 100 percent. The trended depreciation schedule for tax year 2014 2015 is listed below.

 

DRILL RIG TRENDED DEPRECIATION SCHEDULE
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2014 2015	100%	1.000	100%
2013 2014	92%	1.000	92%
2012 2013	84%	1.000 1.009	84 85%
2011 2012	76%	1.027 1.010	78 77%
2010 2011	67%	1.055 1.038	71 70%
2009 2010	58%	1.040 1.066	60 62%
2008 2009	49%	1.077 1.051	53 51%
2007 2008	39%	1.125 1.088	44 42%
2006 2007	30%	1.192 1.137	36 34%
2005 2006	24%	1.252 1.204	30 29%
2004 2005 and older	21%	1.358 1.265	28 27%

(3) remains the same.

(4) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.140 to remove an unnecessary table header and to strike an incorrect implementing statute.

 

42.21.151 LOCALLY ASSESSED CABLE TELEVISION CABLE SYSTEMS

(1) The average market value for television cable systems is $2,000 per mile of coaxial cable (transmission line) and $25 per service drop of central office or headend type equipment will be determined by using a ten-year trended depreciation schedule. 

(2) The market value of transmission and distribution type assets will be determined by using a twenty-year trended depreciation schedule. 

(3) The percent good will be derived from the Marshall & Swift Valuation Service Guide furniture and fixtures depreciation tables, as published by the Marshall and Swift Publication Company, 915 Wilshire Boulevard, 8th Floor, P.O. Box 26307, Los Angeles, California 90026-0307.

(4) The trend factors shall be calculated using the most recent available "Producer Price Index for Commodities," Series Id WPU1178, "Electronic Components and Accessories," published by the United States Department of Labor, Bureau of Labor Statistics.

(2)(5) The average market value for of the dishes and towers will be determined by using a five-year trended depreciation schedule on for dishes and ten-year trended depreciation schedule on for towers. Both the trend factors and the depreciation tables will be derived from the Marshall & Swift Valuation Service Guide, as published by the Marshall and Swift Publication Company, 915 Wilshire Boulevard, 8th Floor, P.O. Box 26307, Los Angeles, California 90026-0307. The trend factors shall be the most recent available from the "Average of all Indexes" listed in the above publication.

(3)(6) The trended depreciation schedules will be applied to the acquired cost including installation and year acquired of the dish or tower equipment.

(4)(7) The trended depreciation schedules referred to in (1), (2), and (3)(5) are listed below and shall be in effect for tax year 2014 2015.

 

TEN-YEAR "HEADEND EQUIPMENT"
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2014	92%	1.000	92%
2013	84%	0.999	84%
2012	76%	0.983	75%
2011	67%	0.955	64%
2010	58%	0.921	53%
2009	49%	0.905	44%
2008	39%	0.874	34%
2007	30%	0.790	24%
2006	24%	0.793	19%
2005 and older	21%	0.783	16%

 

 

TWENTY-YEAR "TRANSMISSION & DISTRIBUTION ASSETS"
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2014	97%	1.000	97%
2013	93%	0.999	93%
2012	90%	0.983	89%
2011	86%	0.955	82%
2010	82%	0.921	76%
2009	78%	0.905	71%
2008	74%	0.874	65%
2007	70%	0.790	55%
2006	65%	0.793	52%
2005	60%	0.783	47%
2004	55%	0.767	42%
2003	50%	0.751	38%
2002	45%	0.742	33%
2001	40%	0.717	29%
2000	35%	0.706	25%
1999	31%	0.696	22%
1998	27%	0.678	18%
1997	24%	0.646	16%
1996	22%	0.617	14%
1995 and older	21%	0.598	13%

 

 

TABLE 1: FIVE-YEAR "DISHES"
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2013 2014	85%	1.000	85%
2012 2013	69%	1.007 1.010	69 70%
2011 2012	52%	1.036 1.018	54 53%
2010 2011	34%	1.068 1.047	36%
2009 2010 and older	21 23%	1.060 1.080	22 25%

 

TABLE 2: TEN-YEAR "TOWERS"
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2013 2014	92%	1.000	92%
2012 2013	84%	1.007 1.010	85%
2011 2012	76%	1.036 1.018	79 77%
2010 2011	67%	1.068 1.047	72 70%
2009 2010	58%	1.060 1.080	61 63%
2008 2009	49%	1.091 1.072	53%
2007 2008	39%	1.134 1.103	44 43%
2006 2007	30%	1.196 1.146	36 34%
2005 2006	24%	1.251 1.209	30 29%
2004 2005 and older	21%	1.345 1.265	28 27%

 

(5)(8) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY:   The department proposes further amending ARM 42.21.151 to provide trended depreciation tables and the valuation method for certain cable television equipment to more accurately reflect current market value. Furthermore, the department proposes removing unnecessary table headers, striking an incorrect implementing statute, and changing the rule title to better reflect the rule content.

 

42.21.153 SKI LIFT EQUIPMENT (1) and (2) remain the same.

(3) The depreciation schedules shall be determined by the life expectancy of the equipment and will normally compensate for the loss in value due to ordinary wear and tear, offset by reasonable maintenance, and ordinary functional obsolescence due to the technological changes during the life expectancy period.

 

DEPRECIATION TABLE FOR SKI LIFT EQUIPMENT
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2013 2014	92%	1.000	92%
2012 2013	84%	1.007 1.010	85%
2011 2012	76%	1.036 1.018	79 77%
2010 2011	67%	1.068 1.047	72 70%
2009 2010	58%	1.060 1.080	61 63%
2008 2009	49%	1.091 1.072	53%
2007 2008	39%	1.134 1.103	44 43%
2006 2007	30%	1.196 1.146	36 34%
2005 2006	24%	1.251 1.209	30 29%
2004 2005 and older	21%	1.345 1.265	28 27%

 

(a) The taxpayer must initially list with the department:

(i) all equipment by year of installation; and

(ii) installed costs of that equipment.

(b) Each year thereafter, the taxpayer must list with the department:

(i) all additions or deletions from the previous year's list, with installed cost.

(4) This methodology is effective for tax years beginning after December 31, 2013 2014. 

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes further amending ARM 42.21.153 to remove an unnecessary table header and to strike an incorrect implementing statute.

 

42.21.155 DEPRECIATION SCHEDULES (1) remains the same.

(2) The trended depreciation schedules for tax year 2014 2015 are listed below. The categories are explained in ARM 42.21.156. The trend factors are derived according to ARM 42.21.156 and 42.21.157.

 

CATEGORY 1

 

YEAR NEW/ ACQUIRED	%GOOD	TREND FACTOR	TRENDED % GOOD
2013 2014	70%	1.000	70%
2012 2013	45%	0.953 0.986	43 44%
2011 2012	20%	0.879 0.934	18 19%
2010 2011 and older	10%	0.808 0.861	8 9%

 

CATEGORY 2
YEAR NEW/ ACQUIRED	% GOOD	TREND FACTOR	TRENDED % GOOD
2013 2014	85%	1.000	85%
2012 2013	69%	0.962 0.998	66 69%
2011 2012	52%	0.975 0.960	51 50%
2010 2011	34%	0.979 0.973	33%
2009 2010 and older	23%	0.937 0.977	22%

 

CATEGORY 3
YEAR NEW/		TREND	TRENDED
ACQUIRED	% GOOD	FACTOR	% GOOD
2013 2014	85%	1.000	85%
2012 2013	69%	0.987 0.999	68 69%
2011 2012	52%	0.959 0.983	50 51%
2010 2011	34%	0.925 0.955	31 32%
2009 2010 and older	23%	0.909 0.921	21%

 

CATEGORY 4
YEAR NEW/		TREND	TRENDED
ACQUIRED	% GOOD	FACTOR	% GOOD
2013 2014	85%	1.000	85%
2012 2013	69%	0.999 0.996	69%
2011 2012	52%	0.995 0.995	52%
2010 2011	34%	0.983 0.991	33 34%
2009 2010 and older	23%	0.972 0.978	22 23%

 

CATEGORY 5
YEAR NEW/		TREND	TRENDED
ACQUIRED	% GOOD	FACTOR	% GOOD
2013 2014	85%	1.000	85%
2012 2013	69%	1.011 1.008	70%
2011 2012	52%	1.042 1.020	54 53%
2010 2011	34%	1.051 1.050	36%
2009 2010 and older	23%	1.056 1.059	24%

 

CATEGORY 6
YEAR NEW/		TREND	TRENDED
ACQUIRED	% GOOD	FACTOR	% GOOD
2013 2014	85%	1.000	85%
2012 2013	69%	1.016 1.015	70%
2011 2012	52%	1.044 1.032	54%
2010 2011	34%	1.080 1.060	37 36%
2009 2010 and older	23%	1.100 1.097	25%

 

 

 

(3) This rule is effective for tax years beginning after December 31, 2013 2014.

 

AUTH: 15-1-201, MCA

IMP: 15-6-135, 15-6-138, 15-6-207, 15-6-219, MCA

 

REASONABLE NECESSITY: The department proposes amending ARM 42.21.155 to strike an incorrect implementing statute.

 

42.21.165 LIVESTOCK REPORTING REQUIREMENTS (1) A taxpayer person who raises or owns livestock in the state of Montana subject to the per capita fees under 15-24-921, MCA, and the requirement of a written statement under 15-24-903, MCA, must submit a completed livestock reporting form.

(2) The department must receive the completed statement postmarked completed livestock reporting form must be submitted no later than February 15 March 1. If a taxpayer fails to timely return a completed livestock reporting form, the The department will issue written notice to the taxpayer advising the taxpayer inform the livestock owner of their obligation to return a completed complete and submit a livestock reporting form. The notice shall also and advise the taxpayer livestock owner that they are subject to penalty under the provisions of 15-8-309 and 15-24-904, MCA, for failure to return submit the reporting form within ten days of receiving the reminder notice in a timely manner.

(3) If a taxpayer livestock owner fails to return a completed and submit a livestock reporting form during the timeframes time frame set forth in (2), the department shall, after ten days' notice, may assess a $25 penalty under 15-8-309, and 15-24-904, MCA.

(4) If, after issuance of the notice required in (2), a taxpayer a livestock owner fails to return submit a completed livestock reporting form, the department will estimate livestock numbers based upon the best information available. The department may utilize previously reported livestock numbers, brand inspections, or other available information as a basis for its estimation.

(5) Statements postmarked submitted after the deadline in (2) will may be assessed a penalty unless:

(a) the taxpayer livestock owner provides evidence of their inability to comply due to hospitalization, physical illness, infirmity, or mental illness; and

(b) evidence that this/these conditions(s), while not necessarily continuous, existed at sufficient levels in the period of January 1 to March 15 1 to prevent timely filing of the reporting form. 

 

AUTH: 15-1-201, MCA

IMP: 15-8-309, 15-24-903, 15-24-904, 15-24-921, MCA

 

REASONABLE NECESSITY: The department proposes amending ARM 42.21.165 to more accurately reflect the department's move to an electronic online livestock reporting process. Because livestock is not subject to ad valorem taxes, the department is completely separating livestock reporting for per capita fee assessment from personal property reporting which is required for ad valorem property tax assessment.

 

42.22.1311 INDUSTRIAL MACHINERY AND EQUIPMENT TREND FACTORS (1) The trend factors will be used to value industrial machinery and equipment for ad valorem tax purposes pursuant to ARM 42.22.1306. The department uses annual cost indexes from the Marshall & Swift Valuation Service Guide. The current index is divided by the annual index for each year to arrive at a trending factor. Each major industry has its own trend table. Where no index existed in the Marshall & Swift Valuation Service Guide for a particular industry, that industry was grouped with other industries using similar equipment. The department will utilize the machinery and equipment trend factors that are set forth in the following tables:

(2) Life expectancies for industrial machinery and equipment are shown in the trend table below.

 

2013 2015 INDUSTRIAL MACHINERY AND EQUIPMENT TREND FACTORS

 

Description                                                                Trend Table               Life

(a) through (cj) remain the same.

Note: 1. Lab equipment is included in its related industry's table at ten-year life expectancy.

 

(3) Tables 1 through 32 represent the yearly trend factors for each of the categories.

 

 

 

 

 

 

 

 

 

 

 

 

YEAR	TABLE 26	TABLE 27	TABLE 28	TABLE 29	TABLE 30
	Refrigeration	Rubber	Steam Power	Textile	Warehousing
2013	1.000	1.000	1.000	1.000	1.000
2012	1.005	1.000	1.000	1.005	1.014
2011	1.036	1.027	1.028	1.030	1.044
2010	1.071	1.057	1.065	1.056	1.074
2009	1.064	1.041	1.055	1.042	1.067
2008	1.100	1.079	1.091	1.073	1.101
2007	1.148	1.121	1.143	1.111	1.140
2006	1.215	1.182	1.220	1.158	1.182
2005	1.273	1.231	1.285	1.202	1.223
2004	1.373	1.320	1.400	1.287	1.309
2003	1.422	1.366	1.452	1.324	1.354
2002	1.451	1.394	1.481	1.343	1.370
2001	1.463	1.398	1.487	1.349	1.375
2000	1.477	1.410	1.499	1.360	1.383
1999	1.506	1.431	1.522	1.380	1.409
1998	1.512	1.437	1.523	1.382	1.410
1997	1.527	1.453	1.534	1.394	1.415
1996	1.552	1.473	1.550	1.418	1.438
1995	1.579	1.501	1.576	1.437	1.451
1994	1.638	1.553	1.638	1.480	1.492

 

 

YEAR	TABLE 31	TABLE 32
	Woodworking	Glass Mfg.
2013	1.000	1.000
2012	1.015	1.005
2011	1.042	1.035
2010	1.074	1.071
2009	1.066	1.059
2008	1.091	1.094
2007	1.126	1.145
2006	1.172	1.213
2005	1.216	1.279
2004	1.298	1.391
2003	1.338	1.446
2002	1.358	1.475
2001	1.371	1.482
2000	1.372	1.497
1999	1.395	1.525
1998	1.397	1.528
1997	1.403	1.541
1996	1.438	1.561
1995	1.453	1.588
1994	1.494	1.652

 

2014	1.000	1.000
2013	1.013	1.008
2012	1.031	1.014
2011	1.058	1.044
2010	1.090	1.080
2009	1.082	1.068
2008	1.107	1.104
2007	1.143	1.154
2006	1.189	1.223
2005	1.234	1.289
2004	1.318	1.403
2003	1.359	1.458
2002	1.379	1.487
2001	1.391	1.495
2000	1.393	1.509
1999	1.416	1.538
1998	1.418	1.541
1997	1.424	1.554
1996	1.460	1.574
1995	1.475	1.601

 

AUTH: 15-1-201, MCA

IMP: 15-6-138, 15-8-111, MCA

 

5. Concerned persons may submit their data, views, or arguments, either orally or in writing, at the hearing. Written data, views, or arguments may also be submitted to: Laurie Logan, Department of Revenue, Director's Office, P.O. Box 7701, Helena, Montana 59604-7701; telephone (406) 444-7905; fax (406) 444-3696; or e-mail [email protected] and must be received no later than November 20, 2014.

 

6. Laurie Logan, Department of Revenue, Director's Office, has been designated to preside over and conduct this hearing.

 

7. The Department of Revenue maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request, which includes the name and e-mail or mailing address of the person to receive notices and specifies that the person wishes to receive notice regarding a particular subject matter or matters. Notices will be sent by e-mail unless a mailing preference is noted in the request. A written request may be mailed or delivered to the person in 5 above or faxed to the office at (406) 444-3696, or may be made by completing a request form at any rules hearing held by the Department of Revenue.

 

8. An electronic copy of this notice is available on the department's web site at revenue.mt.gov. Select the Administrative Rules link under the Other Resources section located in the body of the homepage, and open the Proposal Notices section within. The department strives to make the electronic copy of this notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. While the department also strives to keep its web site accessible at all times, in some instances it may be temporarily unavailable due to system maintenance or technical problems.

 

9. The bill sponsor contact requirements of 2-4-302, MCA, do not apply

 

10. With regard to the requirements of 2-4-111, MCA, the department has determined that the amendment of the above-referenced rules will not significantly and directly impact small businesses.

 

/s/ Laurie Logan                               /s/ Mike Kadas

Laurie Logan                                   Mike Kadas

Rule Reviewer                                 Director of Revenue

           

Certified to the Secretary of State October 14, 2014.