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SENATE BILL NO. 441
INTRODUCED BY C. CHRISTIAENS, G. DEVLIN, A. ELLIS, J. MCKENNEY, B. PAVLOVICH, J. TESTER, C. TUSS, D. WAGNER
AN ACT REQUIRING THE DEPARTMENT OF REVENUE, UNDER CERTAIN CONDITIONS, TO USE TWO OF THE THREE METHODS OF DETERMINING THE MARKET VALUE OF PROPERTY, WHICH INCLUDE THE CAPITALIZATION OF NET INCOME METHOD, THE SALES OF COMPARABLE PROPERTY METHOD, AND THE COST-LESS-DEPRECIATION METHOD, THAT PROVIDE A SIMILAR MARKET VALUE AS THE BETTER INDICATORS OF MARKET VALUE; AMENDING SECTION 15-8-111, MCA; AND PROVIDING AN APPLICABILITY DATE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 15-8-111, MCA, is amended to read:
"15-8-111. Assessment -- market value standard -- exceptions. (1) All taxable property must be assessed at 100% of its market value except as otherwise provided.
(2) (a) Market value is the value at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts.
(b) If the department uses construction cost as one approximation of market value, the department shall fully consider reduction in value caused by depreciation, whether through physical depreciation, functional obsolescence, or economic obsolescence.
(c) If the department uses the capitalization of net income method as one approximation of market value and sufficient, relevant information on comparable sales and construction cost exists, the department shall rely upon the two methods that provide a similar market value as the better indicators of market value.
(c)(d) Except as provided in subsection (3), the market value of special mobile equipment and agricultural tools,
implements, and machinery is the average wholesale value shown in national appraisal guides and manuals or the value
before reconditioning and profit margin. The department shall prepare valuation schedules showing the average wholesale
value when a national appraisal guide does not exist.
(3) The department may not adopt a lower or different standard of value from market value in making the official assessment and appraisal of the value of property, except:
(a) the wholesale value for agricultural implements and machinery is the average wholesale value category as shown in Guides 2000, Northwest Region Official Guide, published by the North American equipment dealers association, St. Louis, Missouri. If the guide or the average wholesale value category is unavailable, the department shall use a comparable publication or wholesale value category.
(b) for agricultural implements and machinery not listed in an official guide, the department shall prepare a supplemental manual in which the values reflect the same depreciation as those found in the official guide; and
(c) as otherwise authorized in Titles 15 and 61.
(4) For purposes of taxation, assessed value is the same as appraised value.
(5) The taxable value for all property is the percentage of market or assessed value established for each class of property.
(6) The assessed value of properties in 15-6-131 through 15-6-133 is as follows:
(a) Properties in 15-6-131, under class one, are assessed at 100% of the annual net proceeds after deducting the expenses specified and allowed by 15-23-503 or, if applicable, as provided in 15-23-515, 15-23-516, 15-23-517, or 15-23-518.
(b) Properties in 15-6-132, under class two, are assessed at 100% of the annual gross proceeds.
(c) Properties in 15-6-133, under class three, are assessed at 100% of the productive capacity of the lands when valued for agricultural purposes. All lands that meet the qualifications of 15-7-202 are valued as agricultural lands for tax purposes.
(d) Properties in 15-6-143, under class ten, are assessed at 100% of the forest productivity value of the land when valued as forest land.
(7) Land and the improvements on the land are separately assessed when any of the following conditions occur:
(a) ownership of the improvements is different from ownership of the land;
(b) the taxpayer makes a written request; or
(c) the land is outside an incorporated city or town."
Section 2. Applicability. [This act] applies on and after January 1, 2000, to tax years beginning after December 31, 1999.
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Latest Version of SB 441 (SB0441.ENR)
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