FAIRFIELD COUNTY
THEORY, CLIENT PROCESS, AND PROGRAM
TAXES RECEIVABLES
Received from LGS Staff:
Date:
Received by Management:
Date:
THEORY
PROPERTY TAXES - Current and Delinquent
Property taxes include amounts levied against all real, public utility, and tangible personal property
located in the County. Taxes collected on real property (other than public utility) in one calendar year
are levied in the preceding calendar year on assessed values as of January 1 of that preceding year,
the lien date. Assessed values are established by the County Auditor at 35 percent of appraised
market value. All property is required to be revalued every six years. The last revaluation was
completed in 2001 and payable in 2002. Real property taxes are payable annually or semiannually.
The first payment is due December 31, with the remainder payable by June 20, unless extended.
Taxes collected from tangible personal property (other than public utility) in one calendar year are
levied in the prior calendar year on assessed values during and at the close of the most recent fiscal
year of the taxpayer that ended on or before March 31 of that calendar year, and at the tax rates
determined in the preceding year. Tangible personal property used in business (except for public
utilities) is currently assessed for ad valorem taxation purposes at 25 percent of its true value.
Amounts paid by multi-county taxpayers are due September 20. Single-county taxpayers may pay
annually or semiannually. If paid annually, payment is due April 30; if paid semiannually, the first
payment is due April 30, with the remainder payable by September 20.
Public utility real and tangible personal property taxes collected in one calendar year are levied in the
preceding calendar year on assessed values determined as of December 31 of the year preceding
the tax collection year, the lien date. Certain public utility tangible personal property currently is
assessed at one hundred percent of its true value. Public utility property taxes are payable on the
same dates as real property taxes described previously.
The County Treasurer collects property tax on behalf of all taxing districts within the County. The
County Auditor periodically remits to the taxing districts their portions of the taxes collected.
Collections of the taxes and remittance of them to the taxing districts are accounted for in various
agency funds of the County.
The full tax rate for all County operations for the year ended December 31, 2004, was $7.05 per
$1,000 of assessed value. A new .5 mill Senior Services levy was passed in 2004 with collections
beginning in 2005. The new County total was $7.55 per $1,000 of assessed value.
Property taxes receivable represents delinquent taxes outstanding and real, tangible personal, and
public utility taxes which were measurable and unpaid as of year end. Although total property tax
collections for the next fiscal year are measurable, amounts to be received during the available period
are not subject to reasonable estimation at December 31 and are not intended to finance the prior
year's operations. The receivable and the portion of the tax levies prepaid by year end into the
Undivided General Tax agency fund (for subdivisions) and governmental levy funds (General, MR/DD,
Mental Health, Bridges, Culverts, and County Roads) are therefore offset by a credit to "Deferred
Revenue" for the modified accrual gaap statements. On the full accrual gaap statements, the amount
of the delinquent taxes outstanding are removed from “Deferred Revenue” and posted to “Taxes
Revenue” for the governmental levy funds.
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FAIRFIELD COUNTY
THEORY, CLIENT PROCESS, AND PROGRAM
TAXES RECEIVABLES
The eventual collection of significantly all real and public utility property taxes (both current and
delinquent) is reasonably assured because of the County's ability to force foreclosure of the properties
on which the taxes are levied. However, for tangible personal property taxes (both current and
delinquent), a determination of the percentage deemed uncollectible should be obtained from the
county treasurer's office. This percentage would be applied against the gross taxes receivable to
yield the estimated net realizable value of such resources. An "Allowance for Uncollectible Property
Taxes" would be set up as a contra account to the gross taxes receivable account if the percentage is
significant. The amount of deferred revenue would then be recorded as the net value of the two
accounts. Any significant amount considered uncollectible would be disclosed in the notes to the
financial statements.
TRAILER TAX
Trailer Tax is based on the purchase price obtained from the title: (1) 95% unfurnished or (2) 80%
furnished with a 10% drop each year.
Revenue is distributed by the county auditor to Fairfield County in the same ratio as other real estate
and public utility taxes are distributed. Because the amount is immaterial, no entry need be made.
The amount of trailer taxes for 2004 collections was less than $21,000 for the governmental levy
funds.
CLIENT PROCESS
The County books real estate taxes receivable for 12/31/04 that will be collected in 2005. LGS
prepares this section using the County reports.
The reports used by LGS to arrive at the receivable are as follows:
AB 116 – obtained from Ed L., Eric, or Bev Hoskinson in the County Auditor’s Office – used
to show gross taxes to be collected in 2005. (Use the personal and real estate columns).
ST 111 – obtained from Bev Hoskinson or Kristy Short in the County Auditor’s Office – to post
the delinquent taxes at 12/31/04.
TX 101 – obtained from Jennifer Effingerin the Treasurer’s Office – to reduce the delinquent
taxes on the ST 111 by the amounts paid from the ST 111 report date to the end of the year,
also used to reduce the AB 116 amounts of prepaids.
TAX FAQ’S – obtained from Bev Hoskinson or Kristy Short in the Auditor’s Office. This is
used for the taxing district breakdowns.
Delinquent Duplicate – obtained from Millie Singleton in the County Auditor’s Office (large
green bar report). Used to determine the delinquent personal property taxes as of year end.
(Obtained amounts paid from the date the delinquent report was run to the end of the year
from the Treasurer’s office – Amy Daubenmire.)
The 2003 and 2004 Tax Levy sheet for the tax rates for the different taxing districts, obtained
from the County Treasurer’s Office.
LGS takes these reports and posts the gross taxes less prepaids plus delinquent taxes at 12/31/04.
A summary sheet is arrived at and then journal entries are written from the summary sheet.
Trailer taxes are not posted as receivables. The amount is very immaterial and not timely for the
immaterialness. In 2004, the mobile home taxes were approximately $21,000 for the governmental
levy funds, very immaterial.
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FAIRFIELD COUNTY
THEORY, CLIENT PROCESS, AND PROGRAM
TAXES RECEIVABLES
The following funds have taxes receivable: General, Mental Health, MRDD, Bridges, Culverts and
County Roads, Older Adult Services Levy, and Undivided Real Estate and Tangible Tax Fund.
CONVERSION PROGRAM
Real Estate Taxes Receivable
1.
Review real estate and public utility tax settlement dates for 2003 collections with
Kristy Short or Ed Laramee in the county auditor’s office.
2.
Obtain the following information:
3.
a.
The gross real property and public utility tax amounts to be assessed and
collected, net of rollback and homestead, for tax year 2004 (collection year
2005). Reduce these levied amounts by any prepayments by property
owners into the Undivided Real Estate and Tangible Tax Fund by December
31 for taxes due in the following year.
b.
Total outstanding real property and public utility delinquencies at the end of
2003, divided between taxes, homestead and rollback.
c.
Property tax rates for tax year 2004 (collection year 2005).
If the County's millage has not changed, use the percentages each fund received in
the prior year. Of the total cash receipts (net of refunds) from real property and
public utility taxes recorded in the undivided general tax fund, determine the real
property and public utility taxes receivable as of December 31 by each recipient fund,
(general, mental health, mental retardation and developmental disabilities, older
adult services levy, and bridges, culverts and county roads). The total receivable for
the undivided general tax fund will include amounts due to entities that are not part of
the County for reporting purposes, such as school districts, municipalities, and all
other political subdivisions within the County.
If the County's millage has changed, multiply the assessed value of property by the
total of the nonvoted millage plus the factored voted millage by county fund. The
total receivable for the undivided general tax fund will be the amount posted on the
tax duplicate less any prepayments prior to December 31.
or
Use the Amended Certificate of Estimated Resources for the current year for the
real property (do not include the amount of homestead and rollback) and public
utility taxes to be received for each recipient fund and record as a receivable.
4.
The following journal entries should be made:
Modified Accrual Entries
Adjusting Entries at 12/31
Undivided Real Estate and Tangible Tax Fund (For all subdivisions excluding the
County):
Debit: Taxes Receivable-Current
Debit: Taxes Receivable-Delinquent (if material)
Credit: Intergovernmental Payable
Credit: Due to Other Funds
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FAIRFIELD COUNTY
THEORY, CLIENT PROCESS, AND PROGRAM
TAXES RECEIVABLES
Each fund with a tax levy:
Debit: Taxes Receivable
Credit: Deferred Revenue
Full Accrual Entries
Each fund with a levy:
Debit: Deferred Revenue (delinquent taxes)
Credit: Taxes Revenue (delinquent taxes)
5.
Provide adequate note disclosure. Include:
a.
Property tax calendar
b.
Lien date
c.
Levy date
d.
Due date
e.
Collection dates
f.
Assessed Valuation
g.
Millage
Tangible Personal Property Taxes Receivable
1.
Review tangible personal property tax settlement dates for 2004 collections from
Millie Singleton (ext. 7027) in the county auditor's office.
2.
Obtain from the county auditor=s office the following information:
a.
b.
c.
3.
The gross tangible personal property tax amounts estimated by the budget
commission to be assessed and collected in 2005 (net of the $10,000
personal property tax reimbursements from the State). Reduce these
estimated amounts by any prepayments by business owners into the
undivided tangible tax fund by December 31 for taxes due in the following
year.
Total outstanding tangible personal property delinquencies at the end of
2004.
Property tax rates for 2004.
If the County's millage has not changed, use the percentages each fund received in
the prior year of the total cash receipts (net of refunds) from tangible personal
property taxes recorded in the undivided personal tax fund, allocate the tangible
personal property taxes receivable as of December 31 by each recipient fund. The
total receivable for the undivided personal tax fund will include amounts due to
entities that are not part of the County, such as school districts, municipalities and all
other political subdivisions within the County less any prepayments received prior to
December 31.
If the millage has changed, use the amount of tangible personal property to be taxed
(less the $10,000 personal property exemption) and multiply by the total of the
unvoted millage plus the factored voted millage by the County fund. The total
receivable for the undivided personal tax fund will be the amount as certified by the
budget commission to be assessed and collected less any prepayments received
prior to December 31. If the millage has not changed, refer to #1 regarding the
amended certificate of estimated resources.
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FAIRFIELD COUNTY
THEORY, CLIENT PROCESS, AND PROGRAM
TAXES RECEIVABLES
4.
The following journal entries should be made:
Modified Accrual Entries
Adjusting Entries at 12/31
Undivided Real Estate and Tangible Tax Fund (For all subdivisions excluding the
County
Debit: Taxes Receivable-Current
Debit: Taxes Receivable-Delinquent (if material)
Credit: Intergovernmental Payable
Credit: Due to Other Funds
Each fund with a tax levy:
Debit: Taxes Receivable
Credit: Deferred Revenue
Full Accrual Entries
Each fund with a levy:
Debit: Deferred Revenue (delinquent taxes)
Credit: Taxes Revenue (delinquent taxes)
5.
Provide adequate note disclosure. Include:
a.
Property tax calendar
b.
Lien date
c.
Filing dates
d.
Due dates
e.
Collection dates
f.
Uncollectible personal property taxes at year end (if significant)
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