As part of the effort this past session by TMHA to pass the omnibus manufactured reform bill, H.B. 2019, there is now enhanced clarification for the proper tax treatment of manufactured homes in a retailers’ inventory.
To take advantage of the favorable tax treatment, retailers, including communities who have retail licenses, should make sure all of their used home inventory is property titled with TDHCA as "retailer’s inventory."
TMHA pursued the law changes in reaction to some Texas counties refusing to treat homes in a retailer’s inventory as manufactured home inventory for taxing purposes. Instead they would treat the homes as personal property. The result is that the tax liability under the personal property designation was 10-12 times more than what it should have been if properly treated as inventory.
TMHA advocated and help pass H.B. 2019 which removes all ambiguity and forces, via new changes to the Tax Code, taxing entities to treat homes titled as inventory with TDHCA as inventory for taxing purposes.
However, for retailers to avail themselves of the tax savings, you must title your homes with TDHCA as inventory before January 1, 2018. If a home is not property titled as inventory at 12:01 a.m., January 1, then the home is considered personal property and will be taxed at the higher amount.
To ensure your homes are titled before the end of the year, TDHCA encourages all Texas retailers to get in their titling paperwork before December 15.
The deadline is fast approaching, so get your title transfers into TDHCA and save on next year’s tax liability.