Mercantile Center is located in a north Fort Worth area in which all taxing authorities have adopted the exemption of business inventory taxes. This exemption applies to inventory items which are shipped out of the state of Texas within 175 days of the date they are acquired or brought into Texas and are in Texas for assembly, storage, manufacture, repair, maintenance, processing or fabrication purposes. The exemption does not apply to oil, natural gas or liquid gases that are immediate derivatives of refining oil or natural gas.
Unlike many areas offering the exemption, Mercantile Center is located in what is known as a Triple Freeport area. This means that all three taxing authorities have adopted the exemption. The savings are tremendous as the illustration below indicates.
Illustration of Freeport Tax Savings
Let's assume a company carries $10 million worth of inventory, with 90 percent leaving Texas within 175 days. Based on the current Tax Rates, Business Inventory Taxes would be as follows.
Exemption Granted by Jurisdiction
|
Location |
City |
County |
School |
Annual Inventory Tax |
Mercantile Center Fort Worth |
Yes |
Yes |
Yes |
$ 29,356 |
Dallas |
Yes |
Yes |
No |
$157,380 |
Arlington |
No |
Yes |
No |
$204,522 |
Grand Prairie |
Yes |
Yes |
No |
$157,837 |
Irving |
No |
Yes |
No |
$221,826 |
Plano |
Yes |
Yes |
No |
$158,541 |
Garland |
No |
Yes |
No |
$212,266 |
As the above illustration indicates, this taxpayer
would save $264,207 per year in personal property/inventory taxes if located in a Triple
Freeport area like Mercantile Center. This translates into $2.64 per square foot of
rent for a 100,000 square foot facility. For assistance in calculating your
potential tax savings, please call Brian Randolph at (817) 831-2121.
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