Request By:
Mr. Charles M. Cox
Attorney at Law
112 Locust Street
P.O. Box 306
Carlisle, Kentucky 40311
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General
The local property valuation administrator has requested you to list, for assessment purposes, any professional trade tools and equipment and accounts receivable. You ask whether the statutes require such listing.
KRS 132.020(2) [effective January 1, 1979] establishes a state ad valorem tax of one and one-half (1 1/2 ) cents upon each $100 of value upon the following classes of intangible personal properties: "(a) accounts receivable, notes, bonds, credits, nondomestic bank deposits and any other intangible property rights arising out of or created in the course of regular and continuing business transactions substantially performed outside this state." (Emphasis added). Subsection (1) of the statute provides a state tax of twenty-five cents (25 ) on each $100 of value of all money in hand, shares of stock, notes, bonds, accounts and other credits, involving domestic business transactions. "Money in hand" means literally what it says: Money in the personal control or possession of the taxpayer.
Under KRS 132.190, all real and personal property within this state is subject to taxation, unless exempted by the constitution. While household goods of a person used in his home is exempt from taxation, under § 170 of the Kentucky Constitution, the personal property of the taxpayer used in his business or profession is not exempt. Thus you would have to list for taxes the personal tangible property in your law office, which could include law library, bookcases, typewriters, filing cabinets and other items of equipment used in that office. No property is exempt from taxation except where provided in the text of the constitution. See §§ 3 and 170, Kentucky Constitution. Thus all property not exempted from taxation by the constitution must be assessed at its fair cash value, etc. Section 172, Kentucky Constitution.
However, under § 171 of the Kentucky Constitution, it was left to the General Assembly to "divide property into classes and to determine what class or classes of property shall be subject to local taxation. " (Emphasis added).