Understanding Farm Use Tags
Farm use tags, also known as agricultural use valuation, is a taxation method that allows property owners to have their land assessed at a lower value for property tax purposes. This reduced tax rate is available to property owners who use their land for agricultural purposes, including farming, forestry, and other related activities. In North Carolina, farm use tags are legal and can provide significant tax savings to property owners who qualify.
Requirements for Farm Use Valuation
To qualify for farm use valuation, property owners must meet certain requirements set forth by the North Carolina Department of Revenue. These requirements include:
- The land must be used for agricultural purposes for at least three out of the past five years.
- The land must be used for commercial agricultural purposes or forestry.
- The property must be at least five acres in size or must have a gross annual income of at least $1,000.
Benefits of Farm Use Valuation
Farm use valuation provides numerous benefits to property owners, including:
- Reduced property taxes: Property owners who qualify for farm use valuation can have their land assessed at a lower value for property tax purposes, which can result in significant tax savings.
- Protection of farmland: By providing tax incentives for agricultural use of land, farm use valuation helps protect farmland from development and urbanization.
- Support for local agriculture: Farm use valuation supports local agriculture by providing tax incentives for property owners to use their land for farming and forestry.
Understanding NC Property Tax Laws
In North Carolina, property tax is assessed on real property, which includes land, buildings, and other structures. The value of the property is assessed every four years by the county tax assessor, and property taxes are due annually. Property tax rates vary by county and are determined by the local government.
Property Tax Exemptions in NC
In addition to farm use valuation, there are other property tax exemptions available in North Carolina, including:
- Elderly or disabled exemption: Property owners who are over 65 or disabled may be eligible for a property tax exemption.
- Veterans exemption: Veterans who are permanently and totally disabled may be eligible for a property tax exemption.
- Property tax deferral: Property owners who are 65 or older or who are disabled may be eligible for a deferral of property taxes.
Property Tax Appeals in NC
If a property owner believes that their property has been valued too high, they may appeal the assessment to the county Board of Equalization and Review. Property owners must file an appeal within a certain timeframe, typically 30 to 60 days after receiving their assessment notice. The Board of Equalization and Review will review the assessment and make a determination on whether to adjust the value.
Conclusion
In conclusion, farm use tags are legal in North Carolina and provide significant tax savings to property owners who use their land for agricultural purposes. To qualify for farm use valuation, property owners must meet certain requirements set forth by the North Carolina Department of Revenue. Additionally, property owners may be eligible for other property tax exemptions, and property tax assessments can be appealed if the property owner believes the assessment is too high.