Property taxes! No one likes to pay them and we hate to see them increasing as property values go up, but they are necessary to support our local government and infrastructure. For farmers or owners of acreage that can be used for agricultural purposes, the state of Ohio has a program that can provide savings on your tax bill. The Current Agricultural Use Value (CAUV) program offers savings for land that is used for agricultural purposes rather than taxing the acreage at the rate that it would for its highest and best use, such as a building lot.
For owners with acreage, the savings can be significant. Here are the key points of the program. The acreage must be used exclusively for any type of commercial farming, including crops, timber, nursery stock, livestock, or conservation. If there are less than 10 acres of land, the annual income from the farming activity must be at least $2500. To take advantage of the program, you must fill out an application with your county annually, usually toward the beginning of the year. The property is inspected to make sure that the parcel in question qualifies for the program. You must file every year and have the property inspected every year to continue in the program.
Something to be aware of if you are purchasing a property or selling a property that has a CAUV currently in place; the CAUV savings do not automatically follow the property or stay in place. If the purchaser of the property does not want to continue to farm the land or decides to use it for other purposes, the land will revert back to non-agricultural use. The county will levy a recoupment charge in the amount of the tax savings for the last 3 years.
The Dayton Area Board of Realtors purchase contract allows the purchaser to indicate if they are planning on continuing to use the land for agricultural purposes. If they check the box that they do intend to use the property for that purpose, the new homeowner will be responsible for filing the appropriate paperwork with the county for the CAUV benefits. If they fail to do so, they may be assessed with the recoupment charge. If the purchaser decides upfront that they do not want to continue to use the property for agricultural purposes, per the contract, the seller is responsible for the recoupment charge.
If you are thinking about purchasing a farm, mini farm, or acreage of any kind, please give Cyndi Shurts a call at 937-604-5194 and let my knowledge and expertise work for you!