| What is Agricultural Assessment and how do I qualify?
Introduction
The Agricultural Districts Law provides for reduced property taxes for land in agricultural production by limiting the assessment of such land to its prescribed agricultural assessment value. Owners whose land satisfies the eligibility requirements may apply for an agricultural assessment.
Upon request, a soil group worksheet is generated from our GIS information to produce a map with the soils over a digital ortho photo which also has the tax parcel information. The soils are counted on the values that are in agricultural production. This information is used for Agricultural Assessments. A $20 fee per parcel for preparation of Soil Group Worksheets
For more information, visit the NYS Dept of Taxation
Need forms? Click here
Questions & Answers
Q. Does farmland automatically receive an agricultural assessment?
A. NO. Landowners must file an application (form RP-305 or RP-305r) with the assessor to receive an agricultural assessment for their parcels. Landowners must
renew annually for an agricultural assessment, and the farmland must satisfy certain gross sales and acreage eligibility requirements.
Q. Can land outside an agricultural district qualify for an agricultural assessment?
A. YES. The requirements and application procedure are the same. However, land located outside of an established agricultural district which receives an agricultural
assessment will continue to be encumbered with an obligation to remain in agricultural use for a period of eight (8) years (land within an agricultural district is
encumbered for five (5) years) or be subject to a payment for conversion to non-agricultural use.
Q. How is eligibility determined?
A. Eligibility is determined by the assessor or board of assessors with whom the application is filed. If denied, the applicant has the right to an administrative review
by the Board of Assessment Review. The following eligibility requirements must be met.
a. Land generally must consist of seven (7) or more acres that were used for the preceding two (2) years for the production for sale of
crops, livestock, or livestock products.
b. The annual gross sales of agricultural products generally must average $10,000 or more for the preceding two (2) years. If an
agricultural enterprise is less than seven acres, it may qualify if average annual gross sales equal $50,000 or more. (See rented land
and exceptions to gross sales requirements.)
Land that supports a commercial horse boarding operation may qualify for an agricultural assessment if the following eligibility requirements
are met:
a. at least seven (7) acres of land supports the commercial horse boarding operation;
b. the operation boards at least ten (10) horses regardless of ownership; and
c. the operation receives $10,000 or more in gross receipts annually in the preceding two years from fees generated through the
boarding of horses and/or through the production for sale of crops, livestock, and livestock products.
d. A startup operation may qualify based on its annual gross sales of agricultural products in the operation’s first or second year. Such
an annual sales must amount to at least $10,000, if the start-up operation has seven (7) or more acres, or to at least $50,000, if
the start-up operation has less than seven acres in agricultural production.
e. A start-up commercial horse boarding operation also may qualify based on annual boarding fees of $10,000 or more in its first or second year.
Q. What land can be included?
A. Agricultural assessment is limited to land used in agricultural production, defined to include cropland, pasture, orchards, vineyards, sugarbush, support land, and
crop acreage either set aside or retired under Federal supply management or soil conservation programs. Up to 50 acres of farm woodland is eligible for an
agricultural assessment per eligible tax parcel. Land and water used for aquacultural production are eligible, as is land under a structure with which crops, livestock or
livestock products are produced. Land visibly associated with the owner’s residence is ineligible.
Q. What if a farm includes several tax parcels?
A. Since farm operations often encompass more than one parcel, eligibility is determined by combining separately assessed parcels that are farmed together as a
single operation. However, a separate application for each separately assessed parcel must be made. A single operation is one distinct agricultural enterprise.
Q. Can rented land qualify for an agricultural assessment?
A. YES. Land rented for agricultural purposes may receive an agricultural assessment. If the rented land satisfies the basic eligibility requirements described above, it
is eligible for agricultural assessment. In addition, if the rented land does not satisfy the average gross sales value requirement, but does satisfy the other
requirements, it may still be eligible if it is farmed, under a written rental agreement of at least five (5) years, with other farmland that satisfies all eligibility
requirements. The applicant must substantiate the existence and the term of the rental agreement by providing the assessor with either a copy of the lease or an
affidavit confirming that such an agreement exists (application RP-305-c). A start-up farm operation may include rented land.
Q. How is the gross sales value determined?
A. Gross sales value means the actual proceeds from sales of agricultural products. The landowner must adequately document sales for the assessor. Proceeds from
all parcels used in a single operation may be combined to satisfy the average gross sales value requirement. If a crop is grown and processed on the farm, the value
of the crop before processing must be used when computing its average gross sales value. When the farm woodland is eligible, proceeds from the sale of woodland
products may be included in the computation of average gross sales value but only to a maximum of $2,000. The commercial horse boarding receipts can be
generated either through the boarding of horses or through the production for sale of crops, livestock, and livestock products or through both.
Q. Are there any exceptions to the gross sales requirement?
A. YES. Agricultural lands affected by natural disasters or continued adverse weather conditions may continue to be eligible. County Cornell Cooperative Extension
staff must certify such natural disaster or weather condition destroyed the agricultural production and, as a result, the average gross sales value for the preceding two
years was less than the minimum required for eligibility. The landowner must document the extent of damage and the gross sales value the land can produce under
normal conditions on the application form RP-305-b. No minimum gross sales value is required for crop acreage either set aside or retired under Federal supply
management or soil conservation programs.
Q. Does the agricultural assessment program apply to buildings?
A. NO. Agricultural assessment applies only to land and any posts, wires and trellises used to support vines or trees for the production of fruit on eligible land. The
program does not apply to farm buildings, residences, and other improvements. Farm buildings and structures may qualify for property tax benefits under Real
Property Tax Law Sections 483, 483-a, 483-b, 483-c. See Farm Building Exemptions brochure for details. However, land under farm buildings and structures that
produce qualified crops, livestock, or livestock products may in certain circumstances receive an agricultural assessment.
Q. What is the application procedure?
A. The landowner’s first step in applying for an agricultural assessment is to go to the county Soil and Water Conservation District office. There, all farmland to be
enrolled in the program will be classified by soil productivity. A district technician plots each farm tax parcel of the farm on a soil map, and calculates the acreage in
each soil group. The landowner should work with the technician to outline woodland areas and ineligible areas. The landowner may exclude any area from the
program and this area should be clearly defined and marked on the map. The technician records the information on a “Soil Group Worksheet” (Form APD-1). The
landowner, in turn, transfers this soil information to the “Application for an Agricultural Assessment” (form RP-305), available from the assessor’s office and
indicates any farm woodland on the parcel. The landowner submits the completed RP-305 application form along with copies of the completed APD-1 soil group
worksheet and the soil map to the assessor by taxable status date. In most towns, taxable status date is March 1, but it is advised to confirm this with the assessor.
Landowners must file an application each year with the local assessor. After the initial application, a short form application (RP-305-r) may be used if there have been
no changes since the previous year’s application.
Q. How is the amount of assessment reduction determined?
A. After deciding whether the parcel, or any part of it, is eligible for an agricultural assessment, the assessor calculates such assessment by multiplying the acreage
in each soil group and farm woodland by the applicable agricultural assessment value. The values for each soil group are annually certified by the New York State
Board of Real Property Services. The sum of the values is multiplied by the municipality’s latest State equalization rate or special equalization rate. The resulting figure
is the agricultural assessment for the eligible land in the parcel. This amount is compared to the assessed value of the eligible land. Any assessed value above the
agricultural assessment is exempt from real property taxation. In other words, taxes on eligible farmland are based on the land’s agricultural assessment rather than its
full assessment.
Q. How is the landowner informed of the result of an application?
A. If a landowner includes a self-addressed, stamped envelope with the application, the assessor must notify the landowner of the approval, modification, or denial
of the application. The assessor will inform the applicant at least ten days before the date for hearing assessment complaints which in most towns is the fourth
Tuesday in May. If an application is denied, the assessor must also state the reason on the form. For applications approved, the assessor must show how the total
assessed value is apportioned between the eligible and ineligible parts of the property for the current year and prior year. A landowner may request the municipal or
school tax collector to disclose the dollar value of reduction in tax liability attributable to lands receiving an agricultural assessment.
Q. What happens if the farmland is taken out of agricultural production?
A. If farmland which has received an agricultural assessment is converted to a nonagricultural use (within five years of last receiving an agricultural assessment if
located in an agricultural district and within eight years if located outside an agricultural district), a payment to recapture the taxes forgone for converting such land
will be imposed. The assessor determines whether a conversion has occurred on the basis of the facts for each case. Conversion is defined as “an outward or
affirmative act changing the use of agricultural land.” Non use of the property (for example, abandoning land or leaving it idle) disqualifies such land from receiving
an agricultural assessment, but is not considered a conversion. Similarly, land converted to a nonagricultural use through oil and gas exploration, or extraction
activity, or through eminent domain or through the purchase of land for the conveyance of a conservation easement to protect the New York City Watershed, or
through other involuntary proceedings (except a tax sale) would be ineligible for an agricultural assessment but would not be subject to a payment for conversion.
Payments for the conversion of agricultural land to a nonagricultural use are added to the taxes levied upon the land so converted. The property may be subject to a
tax sale should such payment remain unpaid. Therefore, these payments generally become the responsibility of the owner of the land at the time of conversion.
A payment for conversion will be equal to five times the taxes saved in the most recent year that the land received an agricultural assessment. In addition, interest of 6
percent per year compounded annually will be added to the payment amount for each year that the land received an agricultural assessment, not exceeding five years.
When only a portion of a parcel is converted, the assessor apportions the assessment and the agricultural assessment and determines the tax savings attributable to the
converted portion. The payment for conversion of the portion of the parcel is then computed.
90 Day Notice – Whenever a conversion occurs, the landowner shall notify the assessor within 90 days. Failure to notify may result in a penalty of two times the
payments owed to a maximum of $500.
Questions:
For additional information on the agricultural assessment program contact any of the following:
The local assessor
The County Director of Real Property Tax Services
Real Property Services Regional Offices
Your Local Soil & Water Conservation District |
