| Agency | City of Boston Assessing Department, Personal Property Unit |
|---|---|
| What you do | State Tax Form 2, known as the Form of List, covering furniture, equipment and other business property |
| When | Due March 1 each year for property held on January 1 |
Watch for this: Sellers assume the tax moves to the buyer at closing. The bill follows the owner on January 1 unless the contract divides it.
What the city taxes
Boston taxes certain business personal property, such as furniture, fixtures, machinery and equipment. It does not tax the building, which falls under real estate tax.
Some kinds of businesses are treated differently under state rules, and small accounts may fall below a threshold. Ask the Assessing Department how your company is classified.
The Form of List
The yearly report is State Tax Form 2, called the Form of List. The city's page says it is due by March 1, and the filing describes property held as of January 1.
Boston's Taxpayer Information Form also has a section for a business that sold, closed or moved before January 1. You give the date and attach support so the city updates its records.
If you do not file
When no form arrives, an assessor estimates the value by looking at similar businesses. That estimate may be higher than the truth, and an abatement is harder to win without the form.
If you are late, the city says to contact the Personal Property Unit and ask what is still possible.
The January 1 rule in a sale year
Because the tax follows ownership on January 1, a seller who closes in the spring still gets the bill for that fiscal year. A buyer who closes in December may find the next year's bill arriving in the buyer's name.
Most asset sales prorate the cost by days, with the seller paying through closing. Put the method and the filing duty in the purchase agreement.
- Name the tax year or years covered by the split
- Say who files the next Form of List
- Hold back a modest amount if the bill is not yet out
- Agree how the party who receives the bill collects from the other
Tell Assessing about the sale
Notify the Assessing Department of the sale date and the buyer's name so next year's account lands with the right owner. Keep proof of the notice with your closing records.
Buyers often ask for evidence that business property taxes are current, and a clean record speeds up the closing.
Related steps
The city side continues with the alcohol license guide for restaurants, and the state side with the bulk sale notice.
Property tax is a small piece of the price. Request a value estimate to see the bigger number.
This page is general information and not tax or legal advice. Confirm the rules and dates with your CPA, your attorney and the Boston Assessing Department before you rely on them.