Earlier this year, the Pinellas County tax collector’s office claimed it was out $2.2 million in tangible personal property taxes from local businesses.
How to collect all that money?
It's part of an annual bureaucratic dance that begins in court and often ends with the businesses paying up.
The county’s top debtor in 2018 was American Express Travel Related Services Co., Inc., which initially owed Pinellas about $717,000 in tangible personal property taxes and fees.
That figure was about nine times larger than the next largest bill, records show. Andrea DiFonte, a spokeswoman for the tax collector’s office, said the corporation paid its taxes on April 30. A spokeswoman for American Express did not respond to a request for comment.
Robert Stern, an attorney and tax expert at Trenam Law in Tampa, said delinquent businesses generally fall into two categories: large corporations who make clerical errors and struggling mom-and-pops.
“I don’t think there’s any business advantage for intentionally not paying your taxes,” he said.
Tangible personal property taxes are similar to their well-known relative, the property tax. But instead of taxing annually based on the value of real estate, tangible personal property taxes are based on the value of everything a business owns excluding real estate.
In general, if a business owns more than $25,000 worth of tangible personal property — bulldozers, staplers, furniture, etc. — it owes these taxes to Pinellas County.
To get the attention of delinquent businesses, the process begins with a routine petition in the Pinellas County court system, which this year was filed in May by Tax Collector Charles Thomas' office.
DiFonte, the spokeswoman, noted that the tax collector’s office works with companies to collect payments even after the petition is filed. Several businesses on the petition’s list of delinquent companies, like American Express, have since paid their taxes or are on payment plans.
At a hearing set for later this summer, a Pinellas judge will hear the warrants for the delinquent taxes listed in the tax collector’s petition. Once the judge ratifies the warrants, the tax collector’s office can use more forceful means to collect the balances, including the garnishing of bank accounts and the seizure of property.
Those methods are rarely used, though.
“Property seizure is essentially limited to businesses that are out of business or are anticipating a bankruptcy,” DiFonte said.
Overall, the tax collector’s office eventually collects 92 to 95 percent of all tangible personal property taxes, said Amber Bradley, another spokeswoman for the office.
But sometimes, collecting the taxes can be difficult.
Businesses close every year. How does Pinellas County plan to collect about $20,000 in delinquent tax payments from various local Blockbuster Video locations? That corporation famously folded in 2013, and all but one of its stores are gone. That store is in Oregon.
Bradley said the collection of certain taxes in Pinellas was delayed by Blockbuster’s 2010 bankruptcy filing. The bankruptcy has since concluded, so the tax collector can issue warrants against Blockbuster again.
But the tax collector couldn’t seize and sell off Blockbuster’s property even if it wanted to.
“At this point the equipment is gone and unable to be located,” Bradley wrote in an email. “The warrant will remain on the account until it expires in seven years.”
Companies in financial trouble are more likely to sell off their movable assets, Stern said.
“If you’re a struggling business, the equipment is probably going to be sold at midnight out the back door anyway,” Stern said.
Generally, delinquencies are rare. Out of the roughly 50,000 businesses in Pinellas County, about 9,400 owe tangible personal property taxes, DiFonte said. And of those, just 467 had unpaid tangible accounts as of early July — about 5 percent.
As with regular property taxes, companies who pay early get a discount — up to 4 percent if they pay taxes in November.
All told, 2018 delinquent payments added up to just 2.6 percent of the $85.65 million in tangible personal property taxes owed by businesses, DiFonte said.
This story was updated after its initial publication to reflect the most recent available number of unpaid tangible accounts.
Contact Kirby Wilson at firstname.lastname@example.org or (727) 893-8793. Follow @kirbywtweets.