August 14, 2007 Reduce Your Property Taxes
Buyers of rural property should consider ways to reduce their property taxes.
The annual amount of property tax the seller pays, the rate of taxation and other information is available in the county Land Book.
Copies are available in the tax-collection office and in the clerk's office where deeds are recorded and kept.
Property-tax breaks are given to farmers for keeping their land in agricultural production. The designation will be called something like farm use or land use. The idea behind farm use and forest stewardship is to encourage landowners to use their land to produce agricultural and timber products.
Once property is classified as such, the owner pays at a much lower rate than the ordinary rate.
Many states have a similar tax break for owners of managed timberland. The owner enrolls his property in the state's forest-stewardship program. A consulting forester performs a baseline timber cruise that describes the current timber resource disaggregated by species, stand location, volumes and current values of merchantable timber, among other things. The owner and the forester work up a management plan for the owner's forest. These objectives can be changed in the future.
In return for managing the owner's property as a timber resource, the county will cut the property tax imposed. Property taxes can be reduced by more than half.
Jennifer Levitz in the July 28-29, 2007 edition of the Wall Street Journal reported on what I consider to be an abuse of such programs in Texas.
Fidelity Investments - that Fidelity! - keeps 24 longhorn cattle on 179 of its 340 acres in Westlake, Texas to get an agricultural exemption from property taxes. Fidelity's tax hit is $714.57, not the $319,417 it would normally owe to Tarrant and Denton counties, Texas. The cattle are raised, just to have them on the property. They're not sold for meat.
To qualify for the benefit, a landowner has to show that his property is being used wholly or in part for raising livestock, growing crops or preserving wildlife. Among the categories permitted are ostriches, pygmy goats, emus and vegetation that provides cover for indigenous birds from predators. Hunting deer on your own land to prevent overgrazing of desirable plants also qualifies.
Samsung Electronics cut its tax bill on 54 acres near Austin from $21,080 to $135.68 by hanging ten birdhouses for wrens, bluebirds, chickadees and titmice and spraying for fire ants.
Dell, Inc. cut its property tax to $1,355 annually from $580,780 by spraying for ants, filling six water stations and keeping 100 bluebird houses.
One family, Levitz reported, tried to get the break with fireflies.
DIRT-SMART readers can draw their own conclusions.
March 4, 2007 — Share Your Stories!
My next book is tentatively titled, No More Nightmares: The DIRT-SMART Buyer’s Collection of Scary Stories and Their Solutions, and it's all about YOU. I need your first-hand accounts of land-buying nightmares. Expunge your painful memories and help others avoid similar experiences at the same time. Read more...
February 26, 2007 — Old Road Easements Can Rain on Your Parade
Steve Kantor, a lawyer, bought a country place in Charlotte, Vermont in 1996. His land now carries an encumbrance that he did not know about when he bought it.
James and Kathy Peterson in Chittenden, Vermont have been seeking approval to build a 2,500-square foot addition to their house for four years. So far, the town won’t let them.
In both cases, these properties contain old public roads that the towns don’t want to abandon. (Ernest Sander, “Roads Not Taken Still Play a Part in Vermont Life: You Can’t Always See Them, but They Do Exist, And They Do Cause Trouble,” Wall Street Journal, February 15, 2007.)
Snowmobile enthusiasts and others want to continue to have the right to use these “sleeper roads.” Landowners—particularly newcomers—are caught by surprise when a normal title search turns up no mention of a public road crossing the property they’re about to buy.
The situation varies from state to state, town to town, as to the status of non-maintained public roads, some of which were laid out in the 18th century.
The Peterson road hasn’t been maintained since the 1830s, but Vermont, unlike Maine, doesn’t presume abandonment after 30 years.
What would you do if you were denied a building permit because a 175-year-old public road that the public doesn’t maintain or use lies in the middle of your planned bedroom?
Lesson: Get title insurance and have your lawyer trace title back as far as he believes is necessary in local circumstances. If an old road easement is mentioned, make sure that it has been abandoned before you buy.
February 20, 2007 — Curtis-Seltzer.com Launches
Announcing the launch of Curtis-Seltzer.com, the first website dedicated to your financial success as a buyer of country property. Check back for updates, news and info about Curtis, Dirt-Smart, and the latest developments affecting rural real-estate investment and development.
Curtis will post new comments here every week or so.