Land use/Deferred


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PRESENT-USE VALUE PROGRAM QUALIFICATIONS (Also known as land use or deferred)

New applications for this program (form AV-5) must be filed in the month of January of the current year. An application required due to the transfer of the land may be submitted any time during the calendar year, but must be submitted within 60 days of the date of the property’s transfer.

THIS IS A DEFERRED TAX PROGRAM! If property loses its eligibility for any reason, deferred taxes become due for the current year plus three years, plus interest for all prior years. If only a part of the qualifying tract loses its eligibility, a determination shall be made of the amount of deferred taxes applicable to that part, and that amount shall become payable with interest.

The owner has the responsibility and duty to notify the Tax Office of any change that could disqualify all or part of a tract of land receiving present –use value. Notice to the Tax Office must include complete information regarding the change and notice must be given before the close of the listing period following the change in use.
The four requirements of this program

I. Ownership
II. Acreage
III. Income
IV. Sound Management

I. Ownership 
    A. Individual 
        1. Must either live on the property, or 
        2. Have owned the property or the property was owned by a relative for 
            four years prior to making application 
        3. Another way to qualify is, if at the transfer of title to the present owner 
            a. the property was under land use and the new owner continues to use the land
                 for the same purposes as the previous owner used it and accepts liability for
                 the deferred taxes. 
            b. the new owner already owns land that is in the land use program 
        4. Relative 
            a. Spouse 
            b. Lineal ancestor (father, grandmother) 
            c. Lineal descendant (son, granddaughter) 
            d. Brother or sister including a stepbrother or stepsister 
            e. Adopted or adoptive child, parent, etc. 
    B. Corporation 
        1. Principal business must be farming, foresting, etc. (as stated in their articles of
        2. All shareholders are directly or indirectly individuals actively engaged in the
             operation of the farm 
         3. Or a relative of an individual who is actively engaged in the business entity
                Note: In order for multiple parcels to qualify as a farm unit, they must be
                under the same ownership. 
II. Acreage 
    A. Agriculture 
        1. Consists of one or more tracts 
        2. One tract must have at least 10 acres in active production 
        3. Brings in woodland and wasteland up to 20 acres 
    B. Horticulture 
        1. Consists of one or more tracts 
        2. One tract must have at least 5 acres in active production 
        3. Brings in woodland and wasteland up to 20 acres 
    C. Forestry 
        1. Consists of one or more tracts 
        2. One tract must have at least 20 acres in active production 
        3. Brings in wasteland only 
    D. Aquaculture 
        1. Consists of one or more tracts 
        2. Must have at least 5 acres in actual production or produce at least 20,000
             pounds of aquatic species for commercial sale annually regardless of acreage. 
        3. Brings in woodland and wasteland up to 20 acres

III. Income (Agricultural, horticultural and aquacultural only) 
    A. Average gross income of $1,000 per year for the past three years 
    B. Be used to produce evergreens for use as Christmas trees and have met the
         qualifying income for the land 
    C. Income includes: 
        1. Sale of all products grown on the land 
        2. Federal conservation reserve program subsidies 
        3. Tobacco buyout income 
        4. Cash rents are not included 
        5. No income requirements for forestry, but does require a Forestry Management
             Plan which must be in place before January 1st of the year when application is
             submitted. A copy of the plan must be submitted with the application.

IV. Sound Management 
    A. Greatest net return consistent with: 
        1. Its conservation 
        2. Long term improvement

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