Farm Appraisal V. BPO

[ucbruin]

Supposed to be.

"Supposed to be."

What does your answer mean?

 

[Terrel L. Shields]

"Supposed to be."

What does your answer mean?

I am unaware of any state that assesses bonafide farmland at full market value. Most assess at 10x rents for each soils class.

 

[Michigan CG]

I am unaware of any state that assesses bonafide farmland at full market value. Most assess at 10x rents for each soils class.

Iowa, Illinois and Michigan do. Many states are not using soil classifications anymore in the mid-west and not rents either. Sales Comparison Approach.

 

[Michigan CG]

"Supposed to be."

What does your answer mean?

Farmland is supposed to be assessed at market value.

 

[Gobears81]

Iowa, Illinois and Michigan do. Many states are not using soil classifications anymore in the mid-west and not rents either. Sales Comparison Approach.

Maybe it changed before I started appraising but Illinois does not base farmland assessments on MV now. Land worth $10,000 per acre might have an assessed value of $450 per acre in IL, so going to MV would be a game changer.

 

[timd354]

Maybe it changed before I started appraising but Illinois does not base farmland assessments on MV now. Land worth $10,000 per acre might have an assessed value of $450 per acre in IL, so going to MV would be a game changer.

There are all kinds of property tax breaks given to farm land in many states.....sometimes these breaks are given by assessing farmland at something else other than market value, sometimes, these breaks are given by giving exemptions to a certain portion of the property tax, sometimes they due this through a combination of both. In some states, the lower property taxes due because of a farmland exemption are recaptured in whole or part if the property is sold, subdivided or the use of the property is changed. It is all pretty interesting and there is a lot of abuse of these tax abatement programs.....in PA, only 10 acres, with very minimal farm usage is required to claim an agricultural exemption from a large part of the property bill - this has been completely abused by wealthy non-farmers with mansions on 10 acres.

 

[apt20]

Maybe it changed before I started appraising but Illinois does not base farmland assessments on MV now. Land worth $10,000 per acre might have an assessed value of $450 per acre in IL, so going to MV would be a game changer.

Correct. Farm land in Illinois is not assessed at market value currently.

 

[Thomas Holding]

In NC all real estate is assessed at market value (as of the effective date of the last county revaluation), however, if the owner has applied for and met the specific requirements to enroll the property in the state Land Use Program, property taxes (based on the market value) will be deferred and annual yearly taxes are instead based on a value per acre determined by the state Legislature.

 

[Terrel L. Shields]

Iowa, Illinois and Michigan do

Not at full market, all have land use exemptions. I would aver most states still use land class

Iowa

The Agricultural Land Tax Credit was originally established in 1939 to help offset higher farm taxes. The credit is available to all owners of agricultural land of 10 acres or more if the use is for agricultural or horticultural purposes. Land owners do not actually file a claim. The county auditor determines the amount of the credit for each taxpayer. This credit was established to partially offset the school tax burden borne by agricultural real estate. Current law allows a credit for any general school fund tax in excess of $5.40 per $1,000 of assessed value.
​

Indiana

The Farm Land Assessment Calculation
Use value assessment of farm land in Indiana works like this. Each acre starts with a base rate, which is the same everywhere in the state. For a decade prior to 2003, the base rate was $495 per acre. For taxes in 2003 through 2005, it was $1,050. In 2006 and 2007, it was $880. The base rate increased to $1,140 for 2008 taxes, to $1,200 for 2009 taxes, and to $1,250 for taxes in 2010. It will be $1,290 for taxes in 2011, and $1,500 for taxes in 2012.

The base rate is multiplied by a soil productivity factor, which was developed by soil scientists (agronomists) to reflect the typical crop yield of the soil type. Soil types have been mapped by the U.S. Department of Agriculture for every county.
​

Ohio

Taxation sets current agricultural use values for each of Ohio's soil types
​

Kansas

director of property valuation shall make an annual determination of the value of land within each of the various classes of land devoted to agricultural use within each county​

 

[Meandering]

There are all kinds of property tax breaks given to farm land in many states.....sometimes these breaks are given by assessing farmland at something else other than market value, sometimes, these breaks are given by giving exemptions to a certain portion of the property tax, sometimes they due this through a combination of both. In some states, the lower property taxes due because of a farmland exemption are recaptured in whole or part if the property is sold, subdivided or the use of the property is changed. It is all pretty interesting and there is a lot of abuse of these tax abatement programs.....in PA, only 10 acres, with very minimal farm usage is required to claim an agricultural exemption from a large part of the property bill - this has been completely abused by wealthy non-farmers with mansions on 10 acres.

There is a difference between the agriculture rebates, and the clean and green program. Nothing needs to be tilled or farmed for clean and green, just 10 ac. or more that will not be developed, the tax difference is "banked" until you want to develop it, then, you must pay the back taxes to get it out of the clean and green program. It's a far different program than the ones that deal with agricultural use, and agricultural preservation, which too is different, and then there is the one where you can sell your development rights to the township for greatly reduced RE taxes, and let's not forget the conservation easements that can still be farmed. They all serve to stifle over development through economic incentives.

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