Property Tax Alert: Texas

November 2005

For Texas property tax purposes, a taxpayer's oil rigs were taxable in the county in which the taxpayer's principal place of business was located and not in the county in which the rigs were located temporarily.

Under Texas law, property is taxable by a taxing unit if it is located in the unit on January 1 for more than a limited time. The agreed facts established that the rigs were constantly moved from one temporary location to another. Accordingly, the rigs were not taxable in the county that was not the taxpayer's place of business because they were at their January 1 location only temporarily. Furthermore, although the taxpayer eventually secured contracts to keep the rigs in the county until a year later, such events were irrelevant to the taxable situs inquiry because situs is determined by looking back in time to the location of the property in the year preceding January 1 of the applicable tax year.

Please contact Rash & Associates for more information.