CATEGORY:

Taxable Property

008

SUBJECT:

Taxable Status

020

TOPIC:

Storage Structures

010

Date Issued
9/4/79

Revision #2
5/1/88

Often problems develop with the classification of property as real estate or personal property. This becomes more complex as applied to the exemption from taxation for manufacturing purposes.

With regard to classification, the Department has long been guided by a decision of the Court of Appeals in a case entitled Anne Arundel County Commissioners vs. Baltimore Sugar Refining Company (99 Md. 481). That decision clearly establishes the principle that machinery, equipment, etc., necessary to the operation of a building as a building is real property and that machinery and equipment necessary in connection with business carried on in a building is personal property.

To insure uniform treatment of grain storage facilities and of storage tanks for oil, chemicals and other finished products, the following is applicable.

REAL PROPERTY:

Structures, other than those specified in (a) below, used for the purpose of housing, storing, or protection of grain or other commodity from the elements, shall be classified as real property and assessed accordingly. Nothing in this sub-paragraph shall be construed to classify structures as personal property wherein equipment or machinery is installed to maintain a suitable climate or temperature necessary to the preservation of the stored grain or commodity. This same determination is to be extended to include all types of storage tanks, including oil tanks, chemical tanks, and any other structure built for the purpose of storing a product. Such tanks should be considered real property and assessed accordingly.

All grain storage bins, storage tanks, or vessel structures used chiefly or entirely in connection with a manufacturing process shall be classed as personal property. It is the responsibility of the Assessor to make the determination between real and personal property on an individual basis and by considering the intent of the user.

1. These include the equipment or machinery used in the cleaning, drying, processing, mixing, and blending of grain or other commodities used exclusively for the processing operation of said grain or other commodity, shall be classified as personal property and assessed accordingly.
   
2. Machinery and equipment (aeration equipment, auger loading and unloading tubes) installed in the structures referred to in a) above shall be classified as personal property and assessed accordingly.