Property factor — Arkansas Code § 26-51-710 [repealed]

# (a) Includable property — Arkansas Code § 26-51-710 [repealed]

(a) Includable property — Arkansas Code § 26-51-710 [repealed].

(1) Property shall be included in the property factor if it is actually used or is available for use or capable of being used during the tax year in the regular course of the taxpayer's trade or business.

(2) Property held as reserves (including reserves of materials) and standby facilities shall be included in the factor.

(3) Property or equipment under construction during the tax year shall be excluded from the factor until such property is actually used in the regular course of the taxpayer's trade or business.

(4) Goods in process that can be or are included in the taxpayer's inventory shall be included in the property factor.

(5) If the property is partially used in the regular course of the taxpayer's trade or business while under construction, the value of the property to the extent used shall be included in the property factor.

(6) Property used in the regular course of the taxpayer's trade or business shall remain in the property factor until its permanent withdrawal is established by an identifiable event, such as its conversion to the production of nonbusiness income, its sale, or the lapse of an extended period of time, normally five (5) years, during which time the property sits idle and is held for sale.

# (b) Consistency — Arkansas Code § 26-51-710 [repealed]

(b) Consistency — Arkansas Code § 26-51-710 [repealed].

(1) If the taxpayer departs from or modifies the method of valuing property or of excluding property from or including property in the property factor used in returns for prior years, the taxpayer shall disclose in its Arkansas return for the current year the nature and extent of the modification.

(2) If the returns filed by the taxpayer with all states to which the taxpayer reports are not uniform in the valuation of property or in the exclusion or inclusion of property in the property factor, the taxpayer shall disclose in its Arkansas return the nature and extent of the variance.

# (c) Numerator — Arkansas Code § 26-51-710 [repealed]

(c) Numerator — Arkansas Code § 26-51-710 [repealed].

(1) The numerator of the property factor shall include the average value of the real and tangible personal property owned or rented by the taxpayer and used in Arkansas during the tax year in the regular course of the taxpayer's trade or business.

(2) Property in transit between locations of the taxpayer shall be considered to be at the destination for purposes of the property factor.

(3) Property in transit between a buyer and seller that is included by the taxpayer in the denominator of its property factor shall be included in the numerator according to the state of destination.

(4) The value of mobile or movable property such as construction equipment, trucks, or leased electronic equipment that are located both inside and outside of Arkansas during the tax year shall be determined for purposes of the numerator of the factor on the basis of total time within Arkansas during the tax year.

(5) An automobile assigned to a traveling employee shall be included in the numerator of the factor on the basis of total miles driven within Arkansas compared to total miles driven everywhere during the tax year.