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AVOID PAYING UNNECESSARY YEAR-END TAXES ON YOUR STEEL INVENTORY!

Call now to sell us your surplus inventory today!

At the end of the year, it is almost inevitable that your company will have some aged or excess steel inventory. If your company buys and sells many products and has a large inventory, Texas Iron & Metal recommends you begin assessing what items you will or will not use moving forward. Selling unneeded inventory could mean large tax savings at the end of year!

Below are a few facts to consider in regard to surplus or excess inventory:

1. Even in well-run companies, anywhere from 20-30 percent of inventory is dead or obsolete.

2. Lower inventory at year-end can save you in taxes. When your business has inventory, the IRS expects you to include the cost (generally) of that inventory as an asset on your books and not expense it. That could mean more taxable income and potentially more taxes.

3. There is no tax advantage to keeping an inventory that is larger than necessary for the business purpose. Purchases of inventory are not a tax deduction until the inventory items are sold or deemed “worthless” and removed from the inventory.

Did You Know?

Inventory tax is an additional property tax against the value of your business’s inventory. Business property can be taxed at both the state-wide and local level, depending on the county or municipality. Inventory taxes, often included in a state’s Business Tangible Personal Property Tax (TPP), pertains to things like furniture, tools and equipment owned by a business — including steel and pipe inventory.

What States Have Inventory Tax?

Seven states currently include inventories in their business personal property taxes:

• Arkansas
• Kentucky
• Louisiana
• Mississippi
• Oklahoma
• West Virginia
• Texas
• Virginia
• Alaska
• Maryland
• Vermont

If your business resides in a state that applies inventory tax or if you have any items you would like for Texas Iron & Metal to look at, call us or send us a list and we’ll provide a value so you know exactly what your material or equipment is worth.