Denton County Business Personal Property Tax Requirements

If your business owns tangible assets in Denton County that produce income, you may owe business personal property tax, but Texas now exempts the first $125,000 of appraised value at each location within a taxing unit.¹ If your property is worth more than that, you file a rendition statement with the Denton Central Appraisal District by April 15, receive a bill from each taxing unit in the fall, and pay by January 31 to avoid penalties.²

What Property Is Taxable

Texas defines tangible personal property as anything that can be seen, weighed, measured, or felt.³ When your business uses those items to produce income, they become taxable. Think office furniture, computers, manufacturing equipment, tools, and shelving. Retail and wholesale businesses also owe tax on inventory held for sale.⁴

Leased equipment is taxable too. The owner of the leased property is responsible for the tax, though a lease may pass that cost through to you. Fixtures attached to a building, like built-in display cases or HVAC systems, can also qualify depending on ownership.

Intangible assets stay outside this tax entirely. Patents, copyrights, accounts receivable, stocks, bonds, insurance policies, and goodwill have no physical form and are not taxed as business personal property.³ What you own and where it sits on January 1 is what determines taxability for the year.⁵

The $125,000 Exemption and Who Can Skip Filing

Texas exempts the first $125,000 of appraised value of business personal property at each location within a taxing unit.¹ A small shop with $80,000 in equipment and inventory owes nothing. A business with $200,000 at one location is taxed only on the $75,000 above the threshold.

The exemption also applies to leased property. A person who leases out tangible personal property gets a $125,000 exemption on the total appraised value of all leased property in a taxing unit, no matter where within that unit it sits.¹

Here’s the practical consequence: if your total business personal property value at a location is at or below $125,000, you are not required to file a rendition.⁶ The appraisal district can still discover and appraise your property on its own, so keep records that support a value below the threshold even if you don’t file anything.

Exemptions for Goods Moving Through Texas

If your business ships products out of state rather than selling them locally, two additional exemptions may apply.

Freeport

The Freeport exemption covers tangible personal property that is acquired in or imported into Texas and shipped out of state within 175 days. It applies to raw materials, goods being assembled or processed, and finished products passing through to out-of-state buyers.⁷ The person who ships the goods out of state does not have to be the person who owned them on January 1, so long as the property leaves Texas within the 175-day window.⁸

Goods in Transit

This exemption covers property that arrives in Texas, is stored at a public warehouse not owned or controlled by the property owner, and is shipped elsewhere within 175 days.⁹ Oil, natural gas, petroleum products, aircraft, and certain dealer inventories do not qualify.

You cannot claim both exemptions on the same property. If goods qualify under Freeport, the goods-in-transit exemption is unavailable for those items.⁹ If the chief appraiser requests documentation that the storage and timing requirements were met, you have 30 days to respond or you forfeit the exemption for that year.

Filing the Rendition

If your property exceeds the $125,000 threshold, file a rendition with the Denton Central Appraisal District. The rendition is a self-report of what you own, where it is, and what it’s worth. Forms are available on the DCAD website.¹⁰

The rendition needs to show the legal name and mailing address of the business, a general description of the property by type (office electronics, heavy machinery, restaurant equipment, and so on), inventory details and quantities, the physical address of the property on January 1, and either a good-faith estimate of market value or the original cost when new plus the acquisition year for each item.⁶

Reporting historical cost and acquisition year is usually the simpler route because the appraisal district applies its own depreciation schedules. You do not need to calculate depreciation yourself.

How Inventory Is Valued

Under Texas law, the market value of inventory is the price it would bring if sold as a complete unit to a buyer who would continue the business.⁴ That typically means wholesale cost, not retail. Document obsolete, damaged, or slow-moving stock, because that evidence supports a lower value than the district might otherwise assign.

Inventory is valued as of January 1 by default, but you can elect a September 1 valuation date by filing a written application with the chief appraiser. The election stays in place for future years until you revoke it in writing or the inventory changes ownership.⁴ A September 1 date can help seasonal businesses whose stock is lower at that point in the year.

Deadlines, Extensions, and Penalties for Late or False Filing

The rendition is due April 15.² A written request to the chief appraiser before April 15 automatically extends the deadline to May 15. With a written showing of good cause, the chief appraiser can grant an additional 15 days.¹¹

Missing the deadline without an approved extension triggers a penalty of 10% of the total taxes owed on the property for that year.¹² That 10% is calculated on the full tax bill, not just the portion above the exemption.

Filing a false rendition with intent to commit fraud or evade taxes carries a 50% penalty of the total taxes imposed on the property for that year. The same penalty applies if you destroy records or present falsified documents during an appraisal district investigation.¹³ A court must make the final determination before this penalty is imposed.

After You File: Notice, Bill, and Delinquency

Once DCAD processes your rendition, it assigns a value to your property. If that value went up from the prior year, you’ll receive a Notice of Appraised Value, usually in the spring.¹⁴ The notice shows the proposed value, the exemptions applied, and how to protest.

Tax bills go out around October 1 and are due by January 31 of the following year. DCAD sets the value; each taxing unit — the county, school districts, cities, and special districts — applies its own rate to that value and sends its own bill.

Taxes not paid by January 31 become delinquent on February 1, and penalties and interest compound quickly. February adds a 6% penalty plus 1% interest. March through June each add another 1% penalty and 1% interest. On July 1, the penalty jumps to a flat 12%, and an attorney collection fee is typically added. Interest keeps accruing at 1% per month until the balance is paid.¹⁵ Business personal property accounts tend to be turned over to a collections attorney earlier than real property accounts.

Protesting the Value

If the appraised value on your notice looks too high, you can protest before the Denton County Appraisal Review Board. File a written notice of protest by May 15 or within 30 days of the date the appraisal notice was delivered, whichever is later.¹⁶ The Comptroller’s Form 50-132 works, but any written document identifying the property, the owner, and the reason for disagreement is sufficient.¹⁷

Common grounds in a business personal property protest:

Overvaluation: the district assigned a market value higher than what the property would actually sell for.
Record errors: the district listed equipment you no longer own, double-counted assets, or applied the wrong depreciation.
Exemption denial: you were denied a Freeport, goods-in-transit, or $125,000 exemption you believe you qualify for.

Your own records carry the most weight: purchase invoices showing original cost, disposal records for items you no longer own, and photos of equipment condition. If the district applied a 10-year depreciation schedule to a computer that’s functionally worthless after four, your records tell that story. The appraisal district must share its evidence with you at least 14 days before a formal hearing, so you’ll know the assumptions you’re arguing against.

If you lease property and your lease requires you to pay the owner’s property taxes, you can protest the value yourself, provided the owner doesn’t file first.¹⁷

Who to Call for What

Questions about appraised value, exemptions, and protests go to the Denton Central Appraisal District.¹⁸ Questions about your actual tax bill, payment options, or delinquent balances go to the tax assessor-collector for the relevant taxing unit. DCAD does not set tax rates or collect payments, and the taxing units do not change appraised values; routing a question to the wrong office sends you back to the start.

1
State of Texas. Texas Tax Code 11.145 – Income-Producing Tangible Personal Property Having Value of Less Than a Certain Amount
2
Texas Comptroller of Public Accounts. Texas Businesses: April 15 is Deadline for Filing Property Tax Renditions
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State of Texas. Texas Tax Code 1.04 – Definitions
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State of Texas. Texas Tax Code 23.12 – Inventory
5
Texas Comptroller of Public Accounts. Property Tax Law Deadlines
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State of Texas. Texas Tax Code 22.01 – Rendition Generally
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State of Texas. Texas Tax Code 11.251 – Tangible Personal Property Exempt
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Texas Comptroller of Public Accounts. The Freeport and Goods in Transit Exemptions
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State of Texas. Texas Tax Code 11.253 – Tangible Personal Property in Transit
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Denton Central Appraisal District. Denton Central Appraisal District Forms
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State of Texas. Texas Tax Code 22.23 – Deadline for Filing Rendition or Report
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State of Texas. Texas Tax Code 22.28 – Penalty for Late Rendition or Report
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State of Texas. Texas Tax Code 22.29 – Penalty for Fraud or Intent to Evade Tax
14
Texas Comptroller of Public Accounts. Notice Requirements
15
State of Texas. Texas Tax Code 33.01 – Penalties and Interest
16
State of Texas. Texas Tax Code 41.44 – Notice of Protest
17
Texas Comptroller of Public Accounts. Appraisal Protests and Appeals
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Denton County, TX. Appraisal Districts