Sec. 12-63. Rule of valuation. Optional depreciation schedules. Depreciation rules for machinery and equipment.
Sec. 12-63. Rule of valuation. Optional depreciation schedules. Depreciation
rules for machinery and equipment. (a) The present true and actual value of land
classified as farm land pursuant to section 12-107c, as forest land pursuant to section
12-107d, as open space land pursuant to section 12-107e, or as maritime heritage land
pursuant to section 12-107g shall be based upon its current use without regard to neighborhood land use of a more intensive nature, provided in no event shall the present true
and actual value of open space land be less than it would be if such open space land
comprised a part of a tract or tracts of land classified as farm land pursuant to section
12-107c. The present true and actual value of all other property shall be deemed by all
assessors and boards of assessment appeals to be the fair market value thereof and not
its value at a forced or auction sale.
(b) (1) For the purposes of this subsection, (A) "electronic data processing equipment" means computers, printers, peripheral computer equipment, bundled software
and any computer-based equipment acting as a computer, as defined in Section 168 of
the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue
code of the United States, as from time to time amended; (B) "leased personal property"
means tangible personal property which is the subject of a written or oral lease or loan
on the assessment date, or any such property which has been so leased or loaned by the
then current owner of such property for three or more of the twelve months preceding
such assessment date; and (C) "original selling price" means the price at which tangible
personal property is most frequently sold in the year that it was manufactured.
(2) Any municipality may, by ordinance, adopt the provisions of this subsection to
be applicable for the assessment year commencing October first of the assessment year
in which a revaluation of all real property required pursuant to section 12-62 is performed
in such municipality, and for each assessment year thereafter. If so adopted, the present
true and actual value of tangible personal property, other than motor vehicles, shall be
determined in accordance with the provisions of this subsection. If such property is
purchased, its true and actual value shall be established in relation to the cost of its
acquisition, including transportation and installation, and shall reflect depreciation in
accordance with the schedules set forth in subdivisions (3) to (6), inclusive, of this
subsection. If such property is developed and produced by the owner of such property
for a purpose other than wholesale or retail sale or lease, its true and actual value shall
be established in relation to its cost of development, production and installation and
shall reflect depreciation in accordance with the schedules provided in subdivisions (3)
to (6), inclusive, of this subsection. The provisions of this subsection shall not apply to
property owned by a public service company, as defined in section 16-1.
(3) The following schedule of depreciation shall be applicable with respect to electronic data processing equipment:
(A) Group I: Computer and peripheral hardware, including, but not limited to, personal computers, workstations, terminals, storage devices, printers, scanners, computer
peripherals and networking equipment:
Assessment Year
Following Acquisition
Depreciated Value As Percentage
Of Acquisition Cost Basis
First yearSeventy per cent
Second yearForty per cent
Third yearTwenty per cent
Fourth year and thereafterTen per cent
(B) Group II: Other hardware, including, but not limited to, mini-frame and main-frame systems with an acquisition cost of more than twenty-five thousand dollars:
Assessment Year
Following Acquisition Depreciated Value As Percentage
Of Acquisition Cost Basis First yearNinety per cent Second yearSixty per cent Third yearForty per cent Fourth yearTwenty per cent Fifth year and thereafterTen per cent
(4) The following schedule of depreciation shall be applicable with respect to copiers, facsimile machines, medical testing equipment, and any similar type of equipment that is not specifically defined as electronic data processing equipment, but is considered by the assessor to be technologically advanced:
Assessment Year
Following Acquisition Depreciated Value As Percentage
Of Acquisition Cost Basis First yearNinety-five per cent Second yearEighty per cent Third yearSixty per cent Fourth yearForty per cent Fifth year and thereafterTwenty per cent
(5) The following schedule of depreciation shall be applicable with respect to machinery and equipment used in the manufacturing process:
Assessment Year
Following Acquisition Depreciated Value As Percentage
Of Acquisition Cost Basis First yearNinety per cent Second yearEighty per cent Third yearSeventy per cent Fourth yearSixty per cent Fifth yearFifty per cent Sixth yearForty per cent Seventh yearThirty per cent Eighth year and thereafterTwenty per cent
(6) The following schedule of depreciation shall be applicable with respect to all tangible personal property other than that described in subdivisions (3) to (5), inclusive, of this subsection:
Assessment Year
Following Acquisition Depreciated Value As Percentage
Of Acquisition Cost Basis First yearNinety-five per cent Second yearNinety per cent Third yearEighty per cent Fourth yearSeventy per cent Fifth yearSixty per cent Sixth yearFifty per cent Seventh yearForty per cent Eighth year and thereafterThirty per cent
(7) The present true and actual value of leased personal property shall be determined
in accordance with the provisions of this subdivision. Such value for any assessment
year shall be established in relation to the original selling price for self-manufactured
property or acquisition cost for acquired property and shall reflect depreciation in accordance with the schedules provided in subdivisions (3) to (6), inclusive, of this subsection. If the assessor is unable to determine the original selling price of leased personal
property, the present true and actual value thereof shall be its current selling price.
(8) With respect to any personal property which is prohibited by law from being
sold, the present true and actual value of such property shall be established with respect
to such property's original manufactured cost increased by a ratio the numerator of
which is the total proceeds from the manufacturer's salable equipment sold and the
denominator of which is the total cost of the manufacturer's salable equipment sold.
Such value shall then be depreciated in accordance with the appropriate schedule in this
subsection.
(9) The schedules of depreciation set forth in subdivisions (3) to (6), inclusive, of
this subsection shall not be used with respect to videotapes, horses or other taxable
livestock or electric cogenerating equipment.
(10) If the assessor determines that the value of any item of personal property produced by the application of the schedules set forth in this subsection does not accurately
reflect the present true and actual value of such item, the assessor shall adjust such value
to reflect the present true and actual value of such item.
(11) Nothing in this subsection shall prevent any taxpayer from appealing any assessment made pursuant to this subsection if such assessment does not accurately reflect
the present true and actual value of any item of such taxpayer's personal property.
(c) (1) For the assessment years commencing October 1, 2006, October 1, 2007,
October 1, 2008, October 1, 2009, October 1, 2010, and October 1, 2011, the annual
declaration of tangible personal property that a taxpayer files with the assessor of the
town, shall be accompanied by a supplement to said declaration on which the taxpayer
shall provide the following information for machinery and equipment eligible for a
grant pursuant to section 12-94b or 12-94f: (A) The assessment year during which such
property was acquired and installed; (B) the original cost of acquisition for such property,
including charges for such property's transportation and installation; (C) the value of
such property depreciated in accordance with the schedule provided by the assessor;
(D) the total of the original cost of acquisition for all such property; and (E) the total
depreciated value of such property for all such property. The assessor shall provide a
declaration of tangible personal property, together with such supplement, to the owner
of each manufacturing facility, as defined in subparagraph (A) of subdivision (72) of
section 12-81, and to the owner of each facility engaged in biotechnology, as defined
in said subparagraph.
(2) For the assessment years commencing October 1, 2006, October 1, 2007, October 1, 2008, October 1, 2009, October 1, 2010, and October 1, 2011, the assessor of
each town shall determine the depreciated value of machinery and equipment, for the
purposes of this section, section 12-94b and section 12-94f, in accordance with the
method said assessor used to determine the depreciated value of the same or similar
machinery and equipment for the assessment year commencing October 1, 2005. The
supplement to the declaration of tangible personal property the assessor provides, pursuant to subdivision (1) of this subsection, for the assessment year commencing October
1, 2006, shall not reflect an alteration of the depreciation schedule that would result in
an assessment increase for any such property, over the assessment of such property for
the assessment year commencing October 1, 2005, and the supplement to such declaration the assessor provides for the assessment years commencing October 1, 2007, October 1, 2008, October 1, 2009, October 1, 2010, and October 1, 2011, shall not reflect
an alteration of the depreciation schedule that would result in an assessment increase
for any such property, over the assessment of such property for the preceding assessment year.
(1949 Rev., S. 1747; 1963, P.A. 490, S. 9; P.A. 96-171, S. 9, 16; P.A. 99-290, S. 1, 2; P.A. 00-230, S. 2; P.A. 02-103,
S. 53; P.A. 06-83, S. 11; 06-196, S. 287; P.A. 07-127, S. 2.)
History: 1963 act made special provisions for farm, forest and open space land; P.A. 96-171 replaced "boards of tax
review" with "boards of assessment appeals", effective May 31, 1996; P.A. 99-290 added new Subsec. (b) re optional
depreciation schedules for personal property and designated existing provisions as Subsec. (a), effective June 15, 1999;
P.A. 00-230 made a technical correction in Subsec. (b)(10); P.A. 02-103 made a technical change in Subsec. (b)(3)(A);
P.A. 06-83 added Subsec. (c) re depreciation rules for machinery and equipment, effective July 1, 2006; P.A. 06-196 made
technical changes in Subsec. (c)(1), effective July 1, 2006; P.A. 07-127 added reference to maritime heritage land in Subsec.
(a), effective July 1, 2007.
Where the assessors adopt rule of valuation conflicting with statute, remedy is by appeal to board of relief. 43 C. 309.
If assessors adopt rule of valuation, assessment may be reduced on appeal to conform to such rule. 63 C. 18, 322. No
distinction in law between assessed and actual value of real estate. 72 C. 372. This statute does not apply unless there is a
market. If no market, then fair value must be otherwise ascertained. 99 C. 336. Cited. 102 C. 210. Cited. 105 C. 581. On
capitalization of income, see 119 C. 5. Where market value not ascertainable, true and actual valuation must be determined
by some other method. 122 C. 230. Property may be found to have market value in the absence of evidence of other sales
of like property in open market. 125 C. 172. History of statute; valuation a question of fact for trier; not erroneous to
consider reproduction cost and capitalization of income as well as actual sales prices in determining fair market value. 131
C. 575. Methods of determining "true and actual value". 146 C. 578. Best test for determination of value is ordinarily that
of market sales. Id., 669. Land residual method discussed. Id. Value of real estate must be gauged by conditions prevailing
over a period of time. Id. Capitalization of net income method of valuation discussed. Id., 681. Cited. 149 C. 32. Fair
market value can be determined from figure fixed by actual sales where there are sales, in ordinary course of business of
other properties comparable in kind and location. Where property was dam and not readily marketable, proper to resort to
other means of ascertaining value as replacement cost minus depreciation. Id., 453. Although present value of all other
property is fair market value, value of "farmland" is based on its current use without regard to neighborhood land use,
even where plaintiffs had sold adjoining land at neighborhood values. 156 C. 107. Where plaintiffs failed to apply for
classification of their farm as farmland under section 12-107c, it was properly valued at its fair market value. Id., 437.
Cited. 162 C. 87. Where golf course is classified as open space, it is valued on its current use and not at the highest value
of farm land. In valuation of open space at current use, legislative intent is that current use value be less than what its fair
market value might be. In determining "current use", no particular formula is required. 174 C. 10. Cited. Id., 380; Id., 556.
Fair market value is price that would probably result from fair negotiations between willing seller and willing buyer. 175
C. 301. Cited. 178 C. 100; Id., 295. Fair market value not determined where the one sale cited was not comparable, value
realized from a forced or bid sale. Id., 606. Cited. 203 C. 425. Cited. 210 C. 233. Cited. 226 C. 407. Cited. 228 C. 23.
Cited. 231 C. 731. Cited. 240 C. 192; Id., 422. Cited. 241 C. 382.
Cited. 3 CA 53. Cited. 4 CA 106. Cited. 7 CA 496. Cited. 33 CA 270. Cited. 38 CA 158. Cited. 41 CA 249.
Market value. Methods for ascertaining. 1 CS 112. Valuation by owner placed in tax list not bar to reduction by court
on appeal from board of relief. 6 CS 203. Cited. Id., 505. No other method legal for assessment if there is a market value.
8 CS 540. Cost of reproduction less depreciation proper if there is no market value. 11 CS 241. If most recent sales in same
vicinity are of property held by bank, they are not a fair criterion for market value. 12 CS 47. Extensive discussion of
various methods of valuation. 20 CS 476. Price index and inclusion of "factory burden" employed to determine assessment
held improper. 25 CS 37.