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ad valorem tax

An ad valorem tax is a tax that is calculated as a percentage of the value of something—such as tangible (physical) personal property (goods in a warehouse, office furniture, computer and telephone systems, inventory, etc.).

For example, county tax assessors often place a value on a business's tangible personal property and assess an ad valorem tax on the property.

In Maine, ad valorem taxes are applied to real property (land and buildings) and personal property that is used for business purposes. The state does not impose a general ad valorem tax on individual personal property for personal use, such as household goods or personal vehicles. However, business personal property, which includes items like office furniture, computer systems, and inventory, is subject to ad valorem taxation. Local municipalities are responsible for assessing the value of such property annually, and the tax rate is determined by the local mill rate, which can vary by jurisdiction. Taxpayers may be required to file a declaration of their business personal property with the local assessor, who then calculates the tax based on the assessed value. It's important for businesses to be aware of the filing deadlines and requirements in their specific municipality to ensure compliance with local tax laws.

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Demystifying Ad Valorem Tax: What You Need to Know

In the confusing world of taxation, one term often whispered with both curiosity and confusion is "ad valorem tax." It's not your everyday tax, and understanding it is essential in today's financial landscape.

Taxes

ad valorem tax

As a LegalFix Member You Will Be an Important Client of Local Law Firms

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Maine State Code

Maine State Code

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Taxes

ad valorem tax