intangible tax

Case Study The intangible tax, once a popular means for raising tax revenues from wealthy individuals, has slowly disappeared, in part because many individuals either discovered ways to legally avoid or simply did not pay the tax. Many states decided the tax was not worth the expense and aggravation of trying to collect it. Florida imposed an intangible personal property tax in 1931 that was based on the market value of intangible property owned by Florida individual residents, Florida entities, and non-Florida businesses with tax situs in Florida. The Florida tax was levied against the market value of corporate stocks and bonds, loans, accounts receivable, leases, mutual funds, money market funds, limited partnership interests, and beneficial interests in any trusts as of January 1. The Florida tax excluded cash, savings accounts, checking accounts, direct bond issues of the federal government, and bonds issued by the State of Florida. The tax rate varied over the years, and in 2006 was 5 mills (0.0005, or $50 on $100,000 of taxable intangibles), with an exemption of $250,000 per resident. In 2006 the Florida legislature voted overwhelmingly to repeal the tax effective January 1, 2007.