Definition of "Agricultural Property"

Kim Anderson real estate agent

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eXp Realty

The term agricultural property means a type of land that has been designed or is permitted to engage in agricultural activities. Also referred to as agricultural land, agricultural properties are usually dedicated to producing food for human consumption. 

Types of Agricultural Property

Agricultural properties are ideal for those interested in growing vegetables around the house for a more bio way of life by making homemade recipes from their garden. The United Nations Food and Agriculture Organization (FAO) defined agricultural properties, and other industries follow that definition. However, the definition for agricultural real estate is a collection of terms that can all describe agricultural properties.

  • Arable land - any land used to produce annually replanted crops;
  • Permanent cropland - any land used to produce annual crops without replanting;
  • Permanent pastures - any land used for grazing livestock.

Agricultural Property and Tax Exemptions

When it comes to agricultural property, the land pertaining to the owner can be used to either cultivate crops or livestock grazing. Production of timber can also be accepted on agricultural property, but states have different means to define what is and isn’t an agricultural property. It’s always best to check with your state or local government, or assessor because tax exemptions are available for agricultural land.

Depending on the state in which you live, the definition of agricultural property can change, similarly to the qualifications for agricultural land tax exemptions. The size of the land, the type of agricultural land, the revenue coming from the agricultural land, and the agricultural use value can affect how the state views the land itself or, in some cases, how the county sees it.

Comments for Agricultural Property

Kathy Kathy said:

Do farmers pay reduced property taxes on their homesteads? ie: the Amish

May 28, 2024  17:57:28

Real Estate Agent

Hello Kathy! Great question! 
While the Amish are generally subject to the same tax obligations as other American citizens, there are instances where they can benefit from various tax advantages on their homesteads. These benefits can include a potential reduction in property taxes if their land meets specific agricultural use criteria. 

For example, have you heard about Pennsylvania's Clean & Green program? It's a fantastic initiative to help landowners, including the Amish, by reducing their property taxes on farmland and forestland. However, there's a catch! Landowners must continue to use their property for agriculture or forestry to remain eligible. If the land use changes, the owner might have to pay back the tax savings from the previous seven years, known as a "rollback tax."

State and local regulations can vary the specifics of property tax reductions. So it's always a good idea to check with local tax authorities or a tax professional for the precise details in your area.

May 30, 2024  10:49:16
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