INTERPRETIVE STATEMENT
The Department of Revenue issued the following Property Tax Advisories (PTAs) effective January 17, 2003:
PTA 7.0.2003 (Sales Tax as an Element of Value). This advisory updates information previously provided in Property Tax Bulletin 75-1. It explains the reasoning behind including sales tax as an element of value when applying the cost approach (trended investment methodology) in real property assessments and excluding the sales tax cost from personal property listings and valuation methods.
PTA 8.0.2002 (Appraisal of Bed and Breakfast Establishments). This advisory updates information previously provided in Property Tax Bulletin 89-2. It explains the appraisal process for bed and breakfast establishments in counties that do not have a sufficient number of sales of these properties to use a standard sales comparison approach.
PTA 9.0.2003 (Assessment of Supplies). This advisory updates information previously provided in Property Tax Bulletin 90-3. The difference between exempt business inventory and taxable supplies is clarified in this advisory.
PTA 10.0.2003 ("True Lease" or Security Agreement). This advisory updates information previously provided in PTB 97-2. PTA 10 clarifies the difference between true leases and installment contracts to answer the question "who is the owner and taxpayer" and aids in the determination of when leased personal property is exempt from personal property taxes when the lessee is exempt.
PTA 12.0.2003 (Classification of Land Used for Christmas Tree Production). This advisory updates information previously provided in PTB 86-1. It clarifies the statutory guidelines for designation of Christmas tree lands under chapter 84.33 RCW. The key points of this advisory are identification of the disqualifying conditions, an explanation of the difference between stump removal or scarification as opposed to plowing and tilling the soil, and classification under open space farm and agriculture if the property meets the requirements contained in RCW 84.34.020.
Requests for copies of these advisories may be directed to Velinda Brown, Property Tax Division, P.O. Box 47471, Olympia, WA 98504-7471, phone (360) 570-5865, fax (360) 586-7602.
Alan R. Lynn
Rules Coordinator