O’connor - Property Taxes In Texas For Leased Vehicles

By Author: Poc
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In Texas, leased vehicles are generally not subject to property taxes unless they are used primarily to produce income. While Texas law begins with the assumption that all property is taxable unless exempt by state or federal law, leased vehicles are exempt when they are not held mainly for income-generating purposes.

Texas provides an exemption for leased vehicles that are used primarily for personal use by the lessee. This exemption applies to passenger cars or trucks with a shipping weight of 9,000 pounds or less that are leased for personal use. Personal use means that more than 50 percent of the vehicle’s usage, based on mileage, is for non-income-producing activities.

The exemption applies only to vehicles leased under agreements entered into on or after January 2, 2001. Leased vehicles contracted before this date remain subject to property taxation. Additionally, cities that adopted an ordinance prior to January 1, 2002, were allowed to continue taxing personal leased vehicles. The law itself became effective on January 1, 2002.

To qualify for the exemption, the lessee must ...
... timely submit an affidavit to the leasing company confirming that the vehicle is primarily used for non-income-producing purposes. The Lessee’s Affidavit of Primarily Non-Income Producing Vehicle Use form can be obtained from the leasing company or printed directly.

For the exemption to be granted, the leasing company must file a Lessor’s Application for Personal Use Lease Automobile Exemptions with the county appraisal district where the vehicle is located by April 30 each year. This application must list all vehicles that qualify as primarily personal-use vehicles. If the application is not filed on time, the vehicle will not receive the exemption for that tax year.

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https://www.poconnor.com/question/personal-use-lease-vehicle-property-taxes/
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