Md. Code Regs. 18.03.01.01

Current through Register Vol. 51, No. 12, June 14, 2024

Section 18.03.01.01 - Categories and Valuation

A. Personal property in the State (other than operating property of railroads and public utilities) falls into three classes:

(1) Stock in business or inventory;

(2) Distilled spirits;

(3) All other personal property.

B. Stock in Business.

(1) Stock in business or inventory is goods held by a taxpayer for sale or goods placed on consignment to another for sale. Stock in business does not include goods manufactured by the taxpayer or obtained from others and held by the taxpayer for purposes other than sale, or goods manufactured by the taxpayer but placed in possession and control of another as in the case of leased goods.

(2) Stock in business is assessed at cost or market value, whichever is lower.

(3) In the case of manufacturers who sell some portion of their product at retail, that portion sold at retail is assessed at the cost a retailer would pay for the goods.

(4) Materials and Supplies. All materials and supplies that are consumed in the day-to-day operation of any business shall be treated as inventories of stock and trade. This includes items such as contractors' supplies, office supplies, wrapping paper, and bags used in a mercantile operation. It excludes such items as bottles, cases, and other returnable containers used by soft drink or beer industries, as well as supplies of rental uniform and linen operations.

C. Distilled Spirits. In the valuation and assessment of inventories of distilled spirits of wholesale whiskey businesses, the Maryland Alcoholic Beverage Tax may not be included as part of the inventory value.

D. All Other Personal Property.

(1) Except for operating property of railroads and public utilities and certain distilled spirits, "all other personal property" includes all personal property other than inventory.

(2) "All other personal property" is assessed at full cash value. Taxpayers shall report property which has been acquired by purchase at cost in the year of acquisition. Taxpayers shall report property which has been acquired other than by purchase (including property manufactured by the taxpayer) at what the property would have sold for in the year of acquisition.

Md. Code Regs. 18.03.01.01