CHAPTER 21. TAXABLE SITUS

TAX CODE

TITLE 1. PROPERTY TAX CODE

SUBTITLE D. APPRAISAL AND ASSESSMENT

CHAPTER 21. TAXABLE SITUS

Sec. 21.01. REAL PROPERTY. Real property is taxable by a taxing

unit if located in the unit on January 1, except as provided by

Chapter 41, Education Code.

Acts 1979, 66th Leg., p. 2247, ch. 841, Sec. 1, eff. Jan. 1,

1979. Amended by Acts 1993, 73rd Leg., ch. 347, Sec. 4.10, eff.

May 31, 1993; Acts 1997, 75th Leg., ch. 165, Sec. 6.74, eff.

Sept. 1, 1997.

Sec. 21.02. TANGIBLE PERSONAL PROPERTY GENERALLY. (a) Except

as provided by Subsections (b) and (e) and by Sections 21.021,

21.04, and 21.05, tangible personal property is taxable by a

taxing unit if:

(1) it is located in the unit on January 1 for more than a

temporary period;

(2) it normally is located in the unit, even though it is

outside the unit on January 1, if it is outside the unit only

temporarily;

(3) it normally is returned to the unit between uses elsewhere

and is not located in any one place for more than a temporary

period; or

(4) the owner resides (for property not used for business

purposes) or maintains the owner's principal place of business in

this state (for property used for business purposes) in the unit

and the property is taxable in this state but does not have a

taxable situs pursuant to Subdivisions (1) through (3) of this

subsection.

(b) Tangible personal property having taxable situs at the same

location as real property detached from a school district and

annexed by another school district under Chapter 41, Education

Code, is taxable in the tax year in which the detachment and

annexation occurs by the same school district by which the real

property is taxable in that tax year under Chapter 41, Education

Code. For purposes of this subsection and Chapter 41, Education

Code, tangible personal property has taxable situs at the same

location as real property detached and annexed under Chapter 41,

Education Code, if the detachment and annexation of the real

property, had it occurred before January 1 of the tax year, would

have changed the taxable situs of the tangible personal property

determined as provided by Subsection (a) from the school district

from which the real property was detached to the school district

to which the real property was annexed.

(c) Tangible personal property has taxable situs in a school

district that is the result of a consolidation under Chapter 41,

Education Code, in the year in which the consolidation occurs if

the property would have had taxable situs in the consolidated

district in that year had the consolidation occurred before

January 1 of that year.

(d) A motor vehicle does not have taxable situs in a taxing unit

under Subsection (a)(1) if, on January 1, the vehicle:

(1) has been located for less than 60 days at a place of

business of a person who holds a wholesale motor vehicle auction

general distinguishing number issued by the Texas Department of

Motor Vehicles under Chapter 503, Transportation Code, for that

place of business; and

(2) is offered for resale.

(e) In this subsection, "portable drilling rig" includes

equipment associated with the drilling rig. A portable drilling

rig designed for land-based oil or gas drilling or exploration

operations is taxable by each taxing unit in which the rig is

located on January 1 if the rig was located in the appraisal

district that appraises property for the unit for the preceding

365 consecutive days. If the drilling rig was not located in the

appraisal district where it is located on January 1 for the

preceding 365 days, it is taxable by each taxing unit in which

the owner's principal place of business in this state is located

on January 1, unless the owner renders the rig under Chapter 22

to the appraisal district in which the rig is located on January

1, in which event the rig is taxable by each taxing unit in which

the rig is located on January 1. If an owner elects to render

any portable drilling rig to the appraisal district in which the

rig is located on January 1 when the rig otherwise would be

taxable at the owner's principal place of business in this state,

all the owner's portable drilling rigs are taxable by the taxing

units in which each rig is located on January 1. Notwithstanding

any other provision of this subsection, if the owner of a

portable drilling rig does not have a place of business in this

state, the rig is taxable by each taxing unit in which the rig is

located on January 1.

Acts 1979, 66th Leg., p. 2247, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 1908, ch. 353, Sec. 2,

eff. Jan. 1, 1984; Acts 1989, 71st Leg., ch. 534, Sec. 5, eff.

Aug. 28, 1989; Acts 1993, 73rd Leg., ch. 347, Sec. 4.11, eff. May

31, 1993; Acts 1997, 75th Leg., ch. 165, Sec. 6.75, eff. Sept. 1,

1997.

Amended by:

Acts 2005, 79th Leg., Ch.

412, Sec. 8, eff. September 1, 2005.

Acts 2006, 79th Leg., 3rd C.S., Ch.

1, Sec. 1(a), eff. January 1, 2007.

Acts 2007, 80th Leg., R.S., Ch.

911, Sec. 1(a), eff. January 1, 2008.

Acts 2009, 81st Leg., R.S., Ch.

933, Sec. 3K.01, eff. September 1, 2009.

Sec. 21.021. VESSELS AND OTHER WATERCRAFT. (a) A vessel or

other watercraft used as an instrumentality of commerce (as

defined in Section 21.031(b) of this code) is taxable pursuant to

Section 21.02 of this code.

(b) A special-purpose vessel or other watercraft not used as an

instrumentality of commerce (as defined in Section 21.031(b) of

this code) is deemed to be located on January 1 for more than a

temporary period for purposes of Section 21.02 of this code in

the taxing unit in which it was physically located during the

year preceding the tax year. If the vessel or watercraft was

physically located in more than one taxing unit during the year

preceding the tax year, it is deemed to be located for more than

a temporary period for purposes of Section 21.02 of this code in

the taxing unit in which it was physically located for the

longest period during the year preceding the tax year or for 30

days, whichever is longer. If a vessel or other watercraft is not

deemed to be located in any taxing unit on January 1 for more

than a temporary period pursuant to this subsection, the property

is taxable as provided by Subdivisions (2) through (4) of Section

21.02 of this code.

(c) This section applies solely to a determination of taxable

situs and does not apply to a determination of jurisdiction to

tax under Section 11.01 of this code.

Added by Acts 1983, 68th Leg., p. 1908, ch. 353, Sec. 3, eff.

Jan. 1, 1984.

Sec. 21.03. INTERSTATE ALLOCATION. (a) If personal property

that is taxable by a taxing unit is used continually outside this

state, whether regularly or irregularly, the appraisal office

shall allocate to this state the portion of the total market

value of the property that fairly reflects its use in this state.

(b) The comptroller shall adopt rules:

(1) identifying the kinds of property subject to this section;

and

(2) establishing formulas for calculating the proportion of

total market value to be allocated to this state.

Acts 1979, 66th Leg., p. 2247, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1991, 72nd Leg., 2nd C.S., ch. 6, Sec. 14,

eff. Sept. 1, 1991.

Sec. 21.031. ALLOCATION OF TAXABLE VALUE OF VESSELS AND OTHER

WATERCRAFT USED OUTSIDE THIS STATE. (a) If a vessel or other

watercraft that is taxable by a taxing unit is used continually

outside this state, whether regularly or irregularly, the

appraisal office shall allocate to this state the portion of the

total market value of the vessel or watercraft that fairly

reflects its use in this state. The appraisal office shall not

allocate to this state the portion of the total market value of

the vessel or watercraft that fairly reflects its use in another

state or country, in international waters, or beyond the Gulfward

boundary of this state.

(b) The appraisal office shall make the allocation as follows:

(1) The allocable portion of the total fair market value of a

vessel or other watercraft used as an instrumentality of commerce

that is taxable in this state is determined by multiplying the

total fair market value by a fraction, the numerator of which is

the number of miles the vessel or watercraft was operated in this

state during the year preceding the tax year and the denominator

of which is the total number of miles the vessel or watercraft

was operated during the year preceding the tax year. For purposes

of this section, "vessel or other watercraft used as an

instrumentality of commerce" means a vessel or other watercraft

that is primarily employed in the transportation of cargo,

passengers, or equipment, and that is economically employed when

it is moving from point to point as a means of transportation.

(2) The allocable portion of the total fair market value of a

special-purpose vessel or other watercraft not used as an

instrumentality of commerce is determined by multiplying the

total fair market value by a fraction, the numerator of which is

the number of days the vessel or watercraft was physically

located in this state during the year preceding the tax year and

the denominator of which is 365. For purposes of this section,

"special-purpose vessel or other watercraft not used as an

instrumentality of commerce" means a vessel or other watercraft

that:

(A) is designed to be transient and customarily is moved from

location to location on a more or less regular basis;

(B) is economically employed when operated in a localized area

or in a fixed place; and

(C) is not primarily employed to transport cargo, passengers,

and equipment but rather to perform some specialized function or

operation not requiring constant movement from point to point.

(c) A vessel or other watercraft used as an instrumentality of

commerce or a special-purpose vessel or other watercraft not used

as an instrumentality of commerce that is used outside this state

and is in this state solely to be converted, repaired, stored, or

inspected is presumed to be in interstate, international, or

foreign commerce and not located in this state for longer than a

temporary period for purposes of Sections 11.01 and 21.02.

(d) If the allocation provisions of this section do not fairly

reflect the use of a vessel or other watercraft in this state, an

alternate allocation formula shall be utilized if the property

owner or appraisal office demonstrates that:

(1) the allocation formula specified in this section is

arbitrary and unreasonable as applied to the vessel or

watercraft; and

(2) the formula or indication of use proposed by the property

owner or appraisal office more fairly reflects the vessel or

watercraft's use in this state than that specified in this

section.

(e) To receive an allocation of value under this section, a

property owner must apply for the allocation on a form that

substantially complies with the form prescribed by the

comptroller. The application must be filed with the chief

appraiser for the district in which the property to which the

application applies is taxable before the approval of the

appraisal records by the appraisal review board as provided by

Section 41.12 of this code.

(f) The comptroller shall promulgate forms and may adopt rules

consistent with the provisions of this section.

(g) A vessel or other watercraft to be used as an

instrumentality of commerce or a special-purpose vessel or other

watercraft not to be used as an instrumentality of commerce that

is under construction in this state is presumed to be in

interstate, international, or foreign commerce and not located in

this state for longer than a temporary period for purposes of

Sections 11.01 and 21.02.

(h) Tangible personal property in this state is presumed to be

in interstate, international, or foreign commerce and not located

in this state for longer than a temporary period for purposes of

Sections 11.01 and 21.02 if the owner demonstrates to the chief

appraiser that the owner intends to incorporate the property in

or attach the property to an identified vessel or other

watercraft described by Subsection (c) or (g).

Added by Acts 1983, 68th Leg., p. 1908, ch. 353, Sec. 3, eff.

Jan. 1, 1984. Amended by Acts 1991, 72nd Leg., 2nd C.S., ch. 6,

Sec. 15, eff. Sept. 1, 1991; Acts 2001, 77th Leg., ch. 117, Sec.

1, eff. Jan. 1, 2002.

Sec. 21.04. RAILROAD ROLLING STOCK. (a) A portion of the total

market value of railroad rolling stock that is appraised as

provided by Subchapter B of Chapter 24 of this code is taxable by

each county in which the railroad operates.

(b) The portion of the total market value that is taxable by a

county is determined by the provisions of Subchapter B of Chapter

24 of this code.

Acts 1979, 66th Leg., p. 2247, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 4823, ch. 851, Sec. 9,

eff. Aug. 29, 1983.

Sec. 21.05. COMMERCIAL AIRCRAFT. (a) If a commercial aircraft

that is taxable by a taxing unit is used both in this state and

outside this state, the appraisal office shall allocate to this

state the portion of the fair market value of the aircraft that

fairly reflects its use in this state. The appraisal office shall

not allocate to this state the portion of the total market value

of the aircraft that fairly reflects its use beyond the

boundaries of this state.

(b) The allocable portion of the total fair market value of a

commercial aircraft that is taxable in this state is presumed to

be the fair market value of the aircraft multiplied by a

fraction, the numerator of which is the product of 1.5 and the

number of revenue departures by the aircraft from Texas during

the year preceding the tax year, and the denominator of which is

the greater of (1) 8,760, or (2) the numerator.

(c) During the time in which any commercial aircraft is removed

from air transportation service for repair, storage, or

inspection, such aircraft is presumed to be in interstate,

international, or foreign commerce and not located in this state

for longer than a temporary period for purposes of Section 11.01

of this code.

(d) A certificated air carrier shall designate the tax situs of

commercial aircraft that land in Texas as either the carrier's

principal office in Texas or that Texas airport from which the

carrier has the highest number of Texas departures.

(e) For purposes of this subchapter, a commercial aircraft shall

mean an instrumentality of air commerce that is:

(1) primarily engaged in the transportation of cargo,

passengers, or equipment for others for consideration;

(2) economically employed when it is moving from point to point

as a means of transportation; and

(3) operated by a certificated air carrier. A certificated air

carrier is one engaged in interstate or intrastate commerce under

authority of the U.S. Department of Transportation.

Added by Acts 1989, 71st Leg., ch. 534, Sec. 6, eff. Aug. 28,

1989.

Sec. 21.055. BUSINESS AIRCRAFT. (a) If an aircraft is used for

a business purpose of the owner, is taxable by a taxing unit, and

is used continually outside this state, whether regularly or

irregularly, the appraisal office shall allocate to this state

the portion of the fair market value of the aircraft that fairly

reflects its use in this state. The appraisal office shall not

allocate to this state the portion of the total market value of

the aircraft that fairly reflects its use beyond the boundaries

of this state.

(b) The allocable portion of the total fair market value of an

aircraft described by Subsection (a) is presumed to be the fair

market value of the aircraft multiplied by a fraction, the

numerator of which is the number of departures by the aircraft

from a location in this state during the year preceding the tax

year and the denominator of which is the total number of

departures by the aircraft from all locations during the year

preceding the tax year.

(c) This section does not apply to a commercial aircraft as

defined by Section 21.05.

Added by Acts 1999, 76th Leg., ch. 970, Sec. 1, eff. June 18,

1999; Acts 1999, 76th Leg., ch. 1481, Sec. 7, eff. Sept. 1, 1999.

Sec. 21.06. INTANGIBLE PROPERTY GENERALLY. (a) Except as

provided by Sections 21.07 through 21.09 of this code, intangible

property is taxable by a taxing unit if the owner of the property

resides in the unit on January 1, unless the property normally is

used in this state for business purposes outside the unit. In

that event, the intangible property is taxable by each taxing

unit in which the property normally is used for business

purposes.

(b) Depositing intangible property with an agency of the state

pursuant to a law requiring or authorizing the deposit is not

using it for a business purpose at the depository.

Acts 1979, 66th Leg., p. 2248, ch. 841, Sec. 1, eff. Jan. 1,

1982.

Sec. 21.07. INTANGIBLES OF CERTAIN TRANSPORTATION BUSINESSES.

(a) A portion of the total intangible value of a transportation

business whose intangibles are appraised as provided by

Subchapter A of Chapter 24 of this code is taxable by each county

in which the business operates.

(b) The portion of the total value that is taxable as provided

by Subsection (a) of this section is determined by the provisions

of Subchapter A of Chapter 24 of this code.

Acts 1979, 66th Leg., p. 2248, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1983, 68th Leg., p. 4823, ch. 851, Sec. 10,

eff. Aug. 29, 1983.

Sec. 21.08. INTANGIBLES OF CERTAIN FINANCIAL INSTITUTIONS. (a)

The taxable situs of intangible property owned by an insurance

company incorporated under the laws of this state is determined

as provided by Article 4.01, Insurance Code.

(b) The taxable situs of intangible property owned by a savings

and loan association is determined as provided by Section 89.003,

Finance Code.

Acts 1979, 66th Leg., p. 2248, ch. 841, Sec. 1, eff. Jan. 1,

1982. Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.89, eff.

Sept. 1, 1999.