HB3424

Starting with property-tax years beginning January 1, 2026 or later, HB3424 changes heavy-equipment dealers’ inventory-tax statements and advance tax deposits from monthly to quarterly. The statutory deadline is the 20th day of the month following each calendar quarter. This changes reporting and payment timing, not the underlying tax into a new quarterly tax or a tax exemption. Final law.

Dealers still calculate the unit property tax for applicable transactions and fund an escrow account used to pay their annual inventory property taxes. For leases or rentals, the existing requirement to collect the unit tax when the customer pays and show it separately on the invoice remains. The existing factor—one-twelfth of the preceding year’s combined property-tax rate at the relevant location—is not changed to one-fourth simply because deposits become quarterly. Existing transaction exclusions also remain. Calculation and inventory framework.

The other changes are practical but significant:

• Annual factor notice: By December 15 each year, the collector must give each owner with an escrow account written notice of the following tax year’s unit property tax factor for each inventory location.
• Quarterly statements, including zero activity: A dealer must use the comptroller’s form every quarter, even if nothing was sold, leased or rented. It must still describe each item and its manufacturer identification/serial number where applicable, but the money fields use aggregate receipts and total unit tax. The separate statutory field explaining why no unit tax was assigned is removed; the comptroller may still require other appropriate information.
• Records instead of a duplicate statement: The bill removes the requirement to send the chief appraiser a copy of each periodic statement. Dealers must retain complete, accurate sale/lease/rental disposition records for at least four years from the item’s disposition. Appraisers and collectors retain examination rights subject to the existing written-request, response-time and judicial-relief safeguards.
• New businesses: Dealers not in business on January 1 still must submit quarterly statements while operating, even if they owe no current-year inventory tax. The existing restriction on assigning tax to sold items or remitting it, except under the specified acquisition agreement, remains.
• Business acquisitions: A buyer who contracts to pay the seller’s current-year inventory tax may use the seller’s applicable tax factor. Both parties must notify the appraiser and collector, and the seller is not released from tax liability.

The separate annual inventory declaration under Section 23.1241 remains. Quarterly filing does not eliminate it, and the bill does not repeal existing late-filing or late-payment penalties.