Inventory falls into four categories:
- Finished Goods
- Raw Materials
- Work in Process
Finished Goods Inventory is inventory that is on hand and ready for sale to the customer and inventory on hand at different points of sale such as the manufacturer, wholesaler, retailer, etc.
Work in Process Inventory refers to goods that are in production and not yet a finished good. This includes any products in any stage of the manufacturing process.
Raw Material Inventory is any type of material, parts, or components used in the manufacturing process to produce finished products.
Supplies are generally items used in business and are kept on hand throughout the year.
Inventory must be valued at the price for which it would sell as a unit to a purchaser who would continue the business. Generally Accepted Accounting Principles (GAAP) definition of market value is very different than the Universal Standards of Professional Appraisal Practices (USPAP) definition.
Exemptions such as Freeport, In-Transit, or FTZ may be applicable.
Contact Bettencourt Tax Advisors, LLC for more information on how BTA can help you lower your property tax values.