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  #1  
Old 07/19/08, 04:57 PM
 
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Location: Texas
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Agriculture exempt???

I am in Montgomery county Texas. I was told if I have livestock I can become agriculture exempt. I have searched on line but I am not sure what this is and what the requirements are.
Does anyone have any information about this???

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  #2  
Old 07/19/08, 05:53 PM
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It often refers to taxation on the real estate (land, buildings) or sales tax you would pay on purchases. Note that you may have to earn 51% of your income for the ag excemption to kick in. It varies with state / local law.

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  #3  
Old 07/19/08, 06:09 PM
 
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Location: Central Texas
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Contact your county appraisal office for assistance regarding
your land used for farming/agriculture. We have cattle on our
small acreage which allows for the exemption.

Also a sales tax exemption can be signed and given to the business
if purchasing something for "farm or Ag use". Google for
"Texas agriculture sales tax exemption" and you should find more
information.


Quote:
Texas is one of 40 states that permit farmland,
ranchland and timberland to be valued
for property tax purposes based on its “agricultural
or timber productivity” value rather than
on its market value. The property must be open
space land used for farming, ranching or timber
or for the promotion or preservation of wildlife.
Productivity value is an estimate of the value
of the land if its use were limited to agriculture,
timber or wildlife only, without influence from
any other market forces that add value to the
land. Therefore, the landowner pays taxes on a
value that may be significantly below the market
value, which is the basis for property tax
valuation for most other properties.
Productivity valuation can be applied only
to the land and appurtenances (fences, stock
watering tanks, irrigation wells, etc.). The value
of houses, barns, milking parlors and other
improvements are calculated using conventional
market-value appraisal methods.

To qualify for an “agricultural or timber productivity”
valuation, the land must meet standards
of “degree of intensity of use” set by the
local appraisal district. These standards are
based on the “typical” degree of intensive use
within the appraisal district. The standards vary
among counties because agricultural resources
and uses differ across Texas.

This lowered valuation is a major benefit to
farmers, ranchers and other owners of qualifying
land. The provision is not a true exemption
because a rollback tax equal to the tax savings
in the 5 most recent years (plus interest) must
be paid when the land changes to a nonagricultural
use. Hence, it becomes an exemption only
for people holding land for more than 5 years.

Nevertheless, this special treatment means more
to landowners in tax savings every year than
any other state or local tax exemption or provision
for agriculture.
The Texas legislature recently approved
another category of land use that qualifies for
preferential assessment — wildlife management.
Under this relatively new provision of the law,
land that has qualified for valuation based on
agricultural use may continue its qualification
if the land is used to protect and promote
wildlife and wildlife habitat. For the land to
qualify, the landowners must follow guidelines
established by the Texas Department of Parks
and Wildlife.
Landowners interested in converting their land
classification from agricultural use to wildlife use
should contact their local county Central Appraisal
District for more information on how
to qualify.
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Old 07/19/08, 07:48 PM
 
Join Date: Jun 2008
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Thanks Yall I knew I would get help here!

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Old 07/19/08, 08:23 PM
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WV follows the USDA definition of a farm. As long as you produce $1,000 worth of ag products, you have a farm if you're in a rural area. Note that $1,000 worth can be entirely consumed by your family. In other words, you don't have to show receipts.

Your county assessor's office will decide whether your property will be classified as a farm. Here they list all of your livestock, hay production, etc. to make the determination.

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  #6  
Old 07/20/08, 07:53 AM
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I'm in the next county over - Waller.

It does depend slightly on county rules, but in general around here, you must meet at least one of the exemption categories for 5 out of 7 consecutive years before you are eligible to get the exemption. (This makes it worthwhile to buy a place that is already ag exempt.)

Our exemption is currently for hay. This is absolutely insane to us, but we do not seem to qualify for the exemption based on our animals, even though we are a functioning dairy farm and 100% of our income is from the farm. ...we've put that on our list of things to try to get changed.

You can call your tax office directly, but another good place to go is your extension agent. They can help you assess the best plan for your land. Be aware that in some counties there is a minimum acreage for eligibility - in our county that magic number is 10. Again - totally ridiculous if you ask me, you can run a functional farm on less. But I don't get to make the rules.

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Old 07/20/08, 10:13 AM
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Location: East Texas
Posts: 154

I'm moving to Franklin County--the farm is 24 acres, used to be an old dairy farm. It's been ag-exempt for almost 30 years with the prior owner. Our exemption is in hay right now, but we'll probably run some cattle, too.

Out my way, you can also get an exemption for timber--I don't think we have enough to qualify out on that place, though. Most places in Marion County, where I live now, are timber exempt.

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  #8  
Old 07/20/08, 11:35 AM
 
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Location: Central Texas
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Quote:
Originally Posted by ShyAnne View Post
I am in Montgomery county Texas. I was told if I have livestock I can become agriculture exempt. I have searched on line but I am not sure what this is and what the requirements are.
Does anyone have any information about this???
Montgomery County Appraisal District has excellent on-line info!
Note: This is handled by the Appraisal District and not the
Tax Assessor/Collector. In some counties, they *could* be in
the same office but they are separate entities.

http://www.mcad-tx.org/html/special.html

The forms are provided for the exemption you are seeking.

You will not want to apply for a 1-d appraisal unless all your
income is derived from farming/ranching. Apply for 1-d-1
for your property tax savings. Either way, the savings are the
same.

Quote:
For your land to be considered for 1-d appraisal, you must show that agriculture is your primary source of income and your primary occupation as well as that your land meets eligibility requirements. Effective Jan. 1, 2008, land that secures a home equity loan described by Section 50(a)(6), Article XVI, Texas Constitution cannot be considered for 1-d appraisal. If agriculture is not your primary income source or occupation, you may want to file an application for appraisal under Art. 8, Sec. 1-d-1, which does not require that agriculture be your primary occupation and income source but provides the same tax savings. The appraisal district can provide you with an application and more information.
Hope this helps to clarify. Sorry I didn't search for you when I
responded earlier.

Linda Welch
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  #9  
Old 07/20/08, 05:46 PM
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Quote:
Originally Posted by BlueHeronFarm View Post
I'm in the next county over - Waller.

It does depend slightly on county rules, but in general around here, you must meet at least one of the exemption categories for 5 out of 7 consecutive years before you are eligible to get the exemption. (This makes it worthwhile to buy a place that is already ag exempt.)

Our exemption is currently for hay. This is absolutely insane to us, but we do not seem to qualify for the exemption based on our animals, even though we are a functioning dairy farm and 100% of our income is from the farm. ...we've put that on our list of things to try to get changed.

You can call your tax office directly, but another good place to go is your extension agent. They can help you assess the best plan for your land. Be aware that in some counties there is a minimum acreage for eligibility - in our county that magic number is 10. Again - totally ridiculous if you ask me, you can run a functional farm on less. But I don't get to make the rules.
I agree that it should be based on the percentage of income.
I wish Texas would get much tighter on ag-exempt requirements...when you farm for a living it gets old seeing doctors,lawyers,white collar types, pilgrims and play farmer wannabes using it as a tax dodge.


Maybe anyone seeking ag exemption should have to make their sole living from farming for a year....lot of the folks moving here from the metromess would stay down there.
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Old 07/20/08, 07:53 PM
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Well, my complaint is that it has nothing to do with Ag, really. My county sets unreasonable stocking rates that would turn our farm into a dirt lot in a year or less. Not a very ag-friendly way to get our exemption. I don't really mind if people want the ag exemption and don't farm - so long as they are not building McMansions or selling out to developers.

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  #11  
Old 07/20/08, 09:04 PM
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Location: Catlett Creek Hog Farm Unit 1
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Quote:
Originally Posted by BlueHeronFarm View Post
Well, my complaint is that it has nothing to do with Ag, really. My county sets unreasonable stocking rates that would turn our farm into a dirt lot in a year or less. Not a very ag-friendly way to get our exemption. I don't really mind if people want the ag exemption and don't farm - so long as they are not building McMansions or selling out to developers.
If you don't farm for the majority of your income you shouldn't be allowed ag exemption, period.

Texas should get much stricter with the farm use tax exemption and farm tags as well.

If people want to take advantage of these things;instead of playing at it, get out and fight it in the heat and cold, wet or dry seven days a week.

If I buy a white coat and stethascope,I can't get a medical license; Buying a briefcase and a nice suit doesn't allow me to practice law.
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  #12  
Old 07/21/08, 07:14 AM
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The unfortunately the percentage of income ruler can bite a real farmer in the butt.

1) Many (most?) farmers also have an off farm job of some sort in the family and all family income gets included in the calculation around here (Vermont).

2) Some years are better than others so some years you qualify and some years you don't by the percentage of income. That's dumb - we're doing the same thing each year.

3) If you sell a piece of land, a farm asset, it throws your percent of income ratio out of balance. If you sell development rights it throws you out of balance. etc

4) If you have income from wind power, cellphone tower rental, etc it doesn't count as farm income.

5) If you have logging income (most farmers around here log in the winter) then that throws you out.

6) If you have carpentry income (many farmers do) then that throws you out.

The system should protect against abuse but the way it is currently setup is bad.

We do really farm and that is virtually all of our income most years but if our logging, firewood, etc get too big one year it jeopardizes our standing as a 'farm'.

Cheers

-Walter
Sugar Mountain Farm
in the mountains of Vermont
http://SugarMtnFarm.com/blog/
http://HollyGraphicArt.com/
http://NoNAIS.org

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  #13  
Old 07/21/08, 07:44 AM
 
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Well, I do not farm for a living, and I do NOT think I need taxed more!!
My Ag exemption does not effect anyone else's, and we do have to maintain it. We maintain ours by leasing out the fields to cattle. Someday we'd like to have our own, but we can't afford enough to do that now.

If we lost the exemption, which was on the property when we bought it, we'd be subject to five years of roll-back taxes.

Why should I have to pay higher rates on an old farm which has never been developed or used for anything else but agriculture?

mary

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Old 07/21/08, 07:45 AM
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We get our tax statement every year and it automatically counts our acreage as ag exempt (not our house or shed or the front 1.5 acres or so of our property... just the remaining 12.5 acres which often has nothing growing on it at all, and which will soon be pasture). We didn't have to fill out anything.

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Old 07/21/08, 10:52 AM
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Quote:
Originally Posted by whinnyninny View Post
We get our tax statement every year and it automatically counts our acreage as ag exempt (not our house or shed or the front 1.5 acres or so of our property... just the remaining 12.5 acres which often has nothing growing on it at all, and which will soon be pasture). We didn't have to fill out anything.
Well, be careful. I would look into what that exemption is for and make an effort to maintain it in some way. If they come to appraise and you are not fulfilling whatever your exemption is for, you can be rolled back. Not saying they will - just that they can. We take photos of the hay being cut and the bales in the field to prove ours.

milkinpigs, I respectfully disagree with the premise that your income needs to come from farming for you to deserve the exemption. I think anyone who is putting the land to good use and working towards the sustainability of open spaces and maintenance of arable land should get the tax break.

Mary is letting cows graze and then poo on her place. Good old-fashioned nutrient cycling. That's a good thing. Much better than digging it up to put in a swimming pool. I think she deserves the break as much as I do for producing food. Not to mention those cows will be food, eventually.

I don't think you need to be a full time farmer to practice good land management. And I think that THAT is what the credit is for. It is not an income tax credit, so it ought not to be related to your income.

My .02
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Old 07/21/08, 12:45 PM
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Quote:
Originally Posted by mary,tx View Post
Well, I do not farm for a living, and I do NOT think I need taxed more!!
you arent getting taxed more. You are getting taxed the regular amount.

Farmers are getting tax breaks so they can afford to put food on your table.
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  #17  
Old 07/23/08, 11:07 PM
 
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Im in Rains county. Im not a full time farmer. We have 5.5 acres and so far have two cows and two pigs but will be getting more animals. Weve been here right at a year and I never looked into the ag expemption which this place did not have when we bought it. Im assuming I wouldnt be able to get one with only 5.5 acres. It would definitly be nice seeing as our taxes are over $3K a year. Thats just crazy for a 30 year old house and 5.5 acres.

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  #18  
Old 05/07/09, 02:20 PM
 
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Quote:
Originally Posted by milkinpigs View Post
If you don't farm for the majority of your income you shouldn't be allowed ag exemption, period.
Just a thought, you might want to gather the facts to temper your comments. Things are already just as you suggest they should be. Read up on it here:
http://recenter.tamu.edu/pdf/1361.pdf
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Old 05/10/09, 10:01 AM
 
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Quote:
Originally Posted by nathan104 View Post
Im in Rains county. Im not a full time farmer. We have 5.5 acres and so far have two cows and two pigs but will be getting more animals. Weve been here right at a year and I never looked into the ag expemption which this place did not have when we bought it. Im assuming I wouldnt be able to get one with only 5.5 acres. It would definitly be nice seeing as our taxes are over $3K a year. Thats just crazy for a 30 year old house and 5.5 acres.
Nathan we are in Hunt County and only have 6.8 acres we get ag, even with the front acre where our home is not counted as ag.

Dispute finding an old horse corral out back our land wasn't ag until recently. The lady at the tax office said if we could get 2 of our neighbors to write letters saying it has been used as ag previously that they would back rate it for previous years.
granny
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  #20  
Old 05/10/09, 10:23 AM
 
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Aren't we running two different topics together here with no separation?

We have Ag exemption which is a reduction or elimination of tax on purchases of certain items used in production of farm products.

We have property tax deferral. This is a reduction in property tax used for agriculture production based on the ability of the land to produce. The deferral is what is based on the minimums set for the gross income and in many states the amount of property in use. With the deferral should you sell the property usually there is a rollback and you have a tax consequence.

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