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Old 09-08-2012, 06:56 PM   #1
Daniel75
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Default Ag exemption for property taxes

Anyone know how much off your taxes it is to have cattle or horses on your property and how many head you have to have to get the exemption?
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Old 09-08-2012, 07:04 PM   #2
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Anyone know how much off your taxes it is to have cattle or horses on your property and how many head you have to have to get the exemption?
You don't need any. You pay retail taxes on one acre around the house and the rest is an open space exemption.
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Old 09-08-2012, 07:07 PM   #3
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This ? comes up all the time and I have seen more wrong answers than right. You need to go to the tax office in the county in ?
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Old 09-08-2012, 07:10 PM   #4
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This ? comes up all the time and I have seen more wrong answers than right. You need to go to the tax office in the county in ?
X2
I believe horses don't count?
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Old 09-08-2012, 07:12 PM   #5
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You don't need any. You pay retail taxes on one acre around the house and the rest is an open space exemption.
I'm fairly sure that's not true.Farm exemption taxes you on what your farm will make not on what it is worth.It's quite a bit of difference.
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Old 09-08-2012, 07:14 PM   #6
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This ? comes up all the time and I have seen more wrong answers than right. You need to go to the tax office in the county in ?
I know what I'm talking about.

Ag exemptions are for people that make their living on agriculture as a business.

Anyone who buys rural property is eligible for open space exemption as far as property taxes. Yes, you should talk to your local tax office but it's no big deal. They will carve out one acre around your residence and tax it appropriately but the rest of the property will be taxed at it's income producing ability which is usually really reasonable.
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Old 09-08-2012, 07:16 PM   #7
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You have to have an ag exempt from previous year, I think 5 or 7 years continually to qualify for ag ex on your land.

Someone mentioned honey bees. I do not know about that part but find out if your property has been in ag ex cycle then you shouldn't have any problem convert into your name.

For example, my tax appraisal district in Caldwell says that I have to have 4 cattle or horse and produce calves or fawns to continue on our 32 acres. OR 20 goats and continually produce or vice versa.

It depends on how many acres you have.

Keep all the receipts for fence, tposts, machinery, on and on except you cannot deduct stall, barns, or anything like that. The lumbers you spent for it is not deductible.

Interest you paid on property are tax deductible even travel trailer interest tax and maintenance on it. It's consider a second home.

There's so many things that you can deduct from being an ag ex holder. Meet with your CPA.

Forewarned!! Don't make your property out as a hobby, IE: hunting. It will disqualify you from tax exemptions. Be very careful with that.

I'm still learning as I go so I am sure there's things I may be missing out on my post. Good luck. Hope it helps.
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Old 09-08-2012, 07:17 PM   #8
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I'm fairly sure that's not true.Farm exemption taxes you on what your farm will make not on what it is worth.It's quite a bit of difference.
Have you done this yourself?

I have.

You are right to a certain extent. They look at the vacant land and establish a value on what income it could produce. It's usually extremely reasonable.
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Old 09-08-2012, 07:18 PM   #9
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Yes I have and that is the same thing as farm exemption.
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Old 09-08-2012, 07:19 PM   #10
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I know what I'm talking about.

Ag exemptions are for people that make their living on agriculture as a business.

Anyone who buys rural property is eligible for open space exemption as far as property taxes. Yes, you should talk to your local tax office but it's no big deal. They will carve out one acre around your residence and tax it appropriately but the rest of the property will be taxed at it's income producing ability which is usually really reasonable.
Yes. That's true. Oh by the way, austinkade. You may want to get an ag ex number from comptrollers office here in Austin.

You don't pay sales tax on things you purchase. Edit: on most things!

Get DBA for your ag ex # file it with ur local office and register with SOS. Secretary of State and ure in business. Then fill out for ag ex# online. Print the card out and the forms for stores you go to often such as TSC or whatever. Even HD, Lowes etc.

When we build house on it. The tax office will only charge you one acre for property tax, no matter what. We pay 36.00 a year for property tax but we will be billed for one acre tax when the house is built. Ag ex is really easy and simple to understand once you dive into it. I was like that recently then got my feet wet and was less complicated than I thought it'd be.

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Old 09-08-2012, 07:19 PM   #11
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The only thing you save from being a true ag/wildlife etc, exempt is sales tax. It makes no difference on property tax.
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Old 09-08-2012, 07:21 PM   #12
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The only thing you save from being a true ag/wildlife etc, exempt is sales tax. It makes no difference on property tax.
Do not go down wildlife tax exempt route. If you want to find a way to deduct on the income tax, go ag ex route. Wildlife tax code changed last Jan to the point where you can't deduct anything even for stuff you purchase for it. That's why I switched to ag ex
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Old 09-08-2012, 07:24 PM   #13
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The only thing you save from being a true ag/wildlife etc, exempt is sales tax. It makes no difference on property tax.
Not true at all.Ag exemption you only pay taxes on what your place produces.
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Old 09-08-2012, 07:25 PM   #14
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The only thing you save from being a true ag/wildlife etc, exempt is sales tax. It makes no difference on property tax.
Ok, we were under the impression that by someone having say 7 head of cattle on the 150 acres we have, that we're getting a small break on the taxes, thereby making it worth it to keep the cattle there. This was a working ranch before so I'm not sure if that meets the aforementioned 5-7 year time period. This is in Red River county.
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Old 09-08-2012, 07:26 PM   #15
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Not true at all.Ag exemption you only pay taxes on what your place produces.
But you have to meet the qualifications for AG exempt as agriculture being your primary business. The law is pretty clear.
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Old 09-08-2012, 07:28 PM   #16
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Not true at all.Ag exemption you only pay taxes on what your place produces.
Good to know. The tax office did say if I grew vegetables, fruits, I'd have to go out and sell it to customers. I didn't want to do that so I'm going with cattle and goats. That way I deal with rancher, customers that comes to me than I go to them.
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Old 09-08-2012, 07:30 PM   #17
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Originally Posted by Austin Kade View Post
Ok, we were under the impression that by someone having say 7 head of cattle on the 150 acres we have, that we're getting a small break on the taxes, thereby making it worth it to keep the cattle there. This was a working ranch before so I'm not sure if that meets the aforementioned 5-7 year time period. This is in Red River county.
U will have to ask Red River tax office to make sure what's your minimum cattle head count is. 7 seems to be low for 150 acres. Ours 32 = 4 heads. May want to talk to them than assume based on hearsay.
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Old 09-08-2012, 07:32 PM   #18
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Good to know. The tax office did say if I grew vegetables, fruits, I'd have to go out and sell it to customers. I didn't want to do that so I'm going with cattle and goats. That way I deal with rancher, customers that comes to me than I go to them.
The tax office will determine what your place should make per year.One of my places is one hundred acres and they have it set at $16000 in production a year.
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Old 09-08-2012, 07:40 PM   #19
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But you have to meet the qualifications for AG exempt as agriculture being your primary business. The law is pretty clear.
Here again wrong answer. I have 308 acres that is under ag exempt. Iam not in the cattle business but lease the grazing rights out. My taxs are around $160 not $6000 I do not make any money on the lease but do save $5840 on taxes This is in my county. I can not speak for the others therefore my first answer still stands
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Old 09-08-2012, 07:41 PM   #20
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If you are thinking you can deduct it on your federal taxes they really closed that window.

from the IRS

Quote:
Not-for-Profit Farming

If you operate a farm for profit, you can deduct all the ordinary and necessary expenses of carrying on the business of farming on Schedule F. However, if you do not carry on your farming activity, or other activity you engage or invest in, to make a profit, you report the income from the activity on line 21 of Form 1040 and you can deduct expenses of carrying on the activity only if you itemize your deductions on Schedule A (Form 1040). Also, there is a limit on the deductions you can take. You cannot use a loss from that activity to offset income from other activities.

Activities you do as a hobby, or mainly for sport or recreation, come under this limit. An investment activity intended only to produce tax losses for the investors also comes under this limit.

The limit on not-for-profit losses applies to individuals, partnerships, estates, trusts, and S corporations. It does not apply to corporations other than S corporations.

In determining whether you are carrying on your farming activity for profit, all the facts are taken into account. No one factor alone is decisive. Among the factors to consider are whether:

You operate your farm in a businesslike manner;

The time and effort you spend on farming indicate you intend to make it profitable;

You depend on income from farming for your livelihood;

Your losses are due to circumstances beyond your control or are normal in the start-up phase of farming;

You change your methods of operation in an attempt to improve profitability;

You, or your advisors, have the knowledge needed to carry on the farming activity as a successful business;

You were successful in making a profit in similar activities in the past;

You make a profit from farming in some years and the amount of profit you make; and

You can expect to make a future profit from the appreciation of the assets used in the farming activity.

Presumption of profit. Your farming or other activity is presumed carried on for profit if it produced a profit in at least 3 of the last 5 tax years, including the current year. Activities that consist primarily of breeding, training, showing, or racing horses are presumed carried on for profit if they produced a profit in at least 2 of the last 7 tax years, including the current year. The activity must be substantially the same for each year within this period. You have a profit when the gross income from an activity is more than the deductions for it.
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Old 09-08-2012, 07:41 PM   #21
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The tax office will determine what your place should make per year.One of my places is one hundred acres and they have it set at $16000 in production a year.
Oh ok. Problem is our property is not all open space. Mostly is wooded areas. I tried to ask for timber. They said not in Caldwell County. I figured I could do hay but it's not going to be much with oil wells and pipes in some area so I decided with livestock. That's how I know how many heads I needed.
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Old 09-08-2012, 07:44 PM   #22
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Here again wrong answer. I have 308 acres that is under ag exempt. Iam not in the cattle business but lease the grazing rights out. My taxs are around $160 not $6000 I do not make any money on the lease but do save $5840 on taxes This is in my county. I can not speak for the others therefore my first answer still stands
We are talking about the same thing. What people normally call an "ag" exemption is really an "open space" exemption. To have a true ag exemption you need to really be in the serious business of making a living from agriculture.
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Old 09-08-2012, 07:45 PM   #23
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If you are thinking you can deduct it on your federal taxes they really closed that window.

from the IRS
I am aware of that but good for AK to read up on it if he hasn't been made aware of it. I have CPA and have been working with him. We are on the same page. So no worries for me.
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Old 09-08-2012, 07:48 PM   #24
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Oh ok. Problem is our property is not all open space. Mostly is wooded areas. I tried to ask for timber. They said not in Caldwell County. I figured I could do hay but it's not going to be much with oil wells and pipes in some area so I decided with livestock. That's how I know how many heads I needed.
Open space can be anything. It can be a pine forest or south texas brush. It doesn't really mean OPEN space like a coastal bermuda field.
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Old 09-08-2012, 07:49 PM   #25
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Because I'm ag assessed on my ranch my valuation is less than 2 percent.
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Old 09-08-2012, 07:53 PM   #26
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Because I'm ag assessed on my ranch my valuation is less than 2 percent.
It would be the same whether you did or didn't make some token attempt to run livestock or farm it.
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Old 09-08-2012, 07:58 PM   #27
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Oh ok. Problem is our property is not all open space. Mostly is wooded areas. I tried to ask for timber. They said not in Caldwell County. I figured I could do hay but it's not going to be much with oil wells and pipes in some area so I decided with livestock. That's how I know how many heads I needed.
Do you have ag assessment in place already on you place in Caldwell County?
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Old 09-08-2012, 08:01 PM   #28
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Open space can be anything. It can be a pine forest or south texas brush. It doesn't really mean OPEN space like a coastal bermuda field.
I understand but I was implying what our property looks like. It was realistic to grow anything but put livestock on it and forget it kinda thing. Rather than worry about our vegetables, orchards, fruits to produce. I look at things as cost effective, it'd be better to put in livestock is all.
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Old 09-08-2012, 08:03 PM   #29
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Do you have ag assessment in place already on you place in Caldwell County?
Our property have been under ag ex for more than 20 years before it was switched into our name. The lady who's in charge at tax office said that timber is mostly for east Texas. Not in Caldwell. That's what she told me personally in person.
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Old 09-08-2012, 08:05 PM   #30
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Hey I'm out. Austin Kade asked for opinion and wanted to find out but this got sidetracked. I do not want to be part of that. AustinKade, I apologize for things to get sidetracked. This is not about my property. It's about yours. I just suggest you to talk to right people at your local tax appraisal office. They will help you with everything. Good luck. I hope all goes well for u.
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Old 09-08-2012, 08:05 PM   #31
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I understand but I was implying what our property looks like. It was realistic to grow anything but put livestock on it and forget it kinda thing. Rather than worry about our vegetables, orchards, fruits to produce. I look at things as cost effective, it'd be better to put in livestock is all.
I'm saying you don't have to do ANYTHING. They will assess your property on it's ability to produce income and you will more than likely be pleasantly surprised with their assessment. If you really WANT to grow cattle or goats then have at it but you don't have to to get the exemption.
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Old 09-08-2012, 08:07 PM   #32
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I'm saying you don't have to do ANYTHING. They will assess your property on it's ability to produce income and you will more than likely be pleasantly surprised with their assessment. If you really WANT to grow cattle or goats then have at it but you don't have to to get the exemption.
Ok. Thank you for clarification. I will call the lady and find out why she told me I have to have something on it to qualify or to keep the exemption. I'm going to delve deeper into this. I appreciate your help with this. I'm learning things everyday! so thank you.
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Old 09-08-2012, 08:21 PM   #33
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Our property have been under ag ex for more than 20 years before it was switched into our name. The lady who's in charge at tax office said that timber is mostly for east Texas. Not in Caldwell. That's what she told me personally in person.
Yes, she's very nice. I wanted to know because we have two different places in CC and as a realtor I find it amazing how many people fail to re apply for ag assessment and pay full pop on taxes and continue ag activity. When they sell it can be difficult to get the ag assessment reinstated for the new owner. Didn't know it you were in that situation or not. I would be happy to help if you were.
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Old 09-08-2012, 08:26 PM   #34
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Yes, she's very nice. I wanted to know because we have two different places in CC and as a realtor I find it amazing how many people fail to re apply for ag assessment and pay full pop on taxes and continue ag activity. When they sell it can be difficult to get the ag assessment reinstated for the new owner. Didn't know it you were in that situation or not. I would be happy to help if you were.
Yes, sir Very nice and sweet lady. Yes. I'd like to know more about it. I'll pm you my text nbr.

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Old 09-08-2012, 08:43 PM   #35
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Ok. Thank you for clarification. I will call the lady and find out why she told me I have to have something on it to qualify or to keep the exemption. I'm going to delve deeper into this. I appreciate your help with this. I'm learning things everyday! so thank you.
She is correct. By law, the property must be under ag production for the required number of years to qualify for the ag assessment.
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Old 09-08-2012, 08:44 PM   #36
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When I bought my place back in 99, I got it ag excempt. All the tax office asked me was "What are you going to do with it"??
First I said was to clear some of it and sprig it with coastal.
Next, was to put some cows on it or maybe use it for hay.
They told me I had like 2 yrs to get that put in place. Also was told that cattle or hay was good enough. Not once did somebody ever ask how much income I thought I was going to make off of it.
Another thing they did was compute the whole place (acreage) in ag. and the house is separate, even though they know we live on the place. I don't know what the regs are, but sounds like I got a good deal!!!
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Old 09-08-2012, 08:56 PM   #37
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When I bought my place back in 99, I got it ag excempt. All the tax office asked me was "What are you going to do with it"??
First I said was to clear some of it and sprig it with coastal.
Next, was to put some cows on it or maybe use it for hay.
They told me I had like 2 yrs to get that put in place. Also was told that cattle or hay was good enough. Not once did somebody ever ask how much income I thought I was going to make off of it.
Another thing they did was compute the whole place (acreage) in ag. and the house is separate, even though they know we live on the place. I don't know what the regs are, but sounds like I got a good deal!!!
They use their tables/formulas and estimate what the property should produce.

Then go from there to establish a valuation to tax you on.

I think?

It's a good deal no mater what.
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Old 09-08-2012, 11:22 PM   #38
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I'm saying you don't have to do ANYTHING. They will assess your property on it's ability to produce income and you will more than likely be pleasantly surprised with their assessment. If you really WANT to grow cattle or goats then have at it but you don't have to to get the exemption.
I would like for you to come and explain that to the tax people where I live..
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Old 09-09-2012, 12:47 AM   #39
Daniel75
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Quote:
Originally Posted by Silent Assassin View Post
Hey I'm out. Austin Kade asked for opinion and wanted to find out but this got sidetracked. I do not want to be part of that. AustinKade, I apologize for things to get sidetracked. This is not about my property. It's about yours. I just suggest you to talk to right people at your local tax appraisal office. They will help you with everything. Good luck. I hope all goes well for u.
Guys, I don't mind, this is all new to me! I'm enjoying y'all's input. Carry on
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Old 09-09-2012, 01:13 AM   #40
BrianL
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I can tell for a fact that you have to do something in Red River county, or they will tax you on the value of the land. They will remove the ag/timber exemption, and it can take two to five years to get it back to ag exemption, unless it changes ownership. IF IT is under ag you can transfer to wildlife, but you will loose some good federal tax advantages. Advantage is it is easier to meet goals to maintain your exemption.

In red river county they will value your property at about 1500/ac w/o exemption, and tax on that value.
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Old 09-09-2012, 04:34 AM   #41
Stan R
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I think you have to file for the ag exemption at the central appraisal office.

I assume everyone is using the tac office name in place of this.

The appraisal office is that place that sets to value of the property.

The tax office just collected the taxes based upon the tax rates and the value of the propery as determined by the CAD.

When I bought my small farm I was able to take over the existing ag exemption for hay production.

The CAD office for your county. The office for my county very helpful and answered all question.

Last edited by Stan R; 09-09-2012 at 04:38 AM..
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Old 09-09-2012, 08:15 AM   #42
Silent Assassin
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Originally Posted by Stan R View Post
I think you have to file for the ag exemption at the central appraisal office.

I assume everyone is using the tac office name in place of this.

The appraisal office is that place that sets to value of the property.

The tax office just collected the taxes based upon the tax rates and the value of the propery as determined by the CAD.

When I bought my small farm I was able to take over the existing ag exemption for hay production.

The CAD office for your county. The office for my county very helpful and answered all question.
Yeah. CAD is what I meant. They're always nice and there for me to answer any questions.

I know for a fact she told me I have to have something that will produce or lose the AG ex. I will email her about the assessment. We shall see. Thanks for sharing.

It's really interesting to see different inputs. Maybe because each county are different. I do not know but very interesting.
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Old 09-09-2012, 09:13 AM   #43
down2hunt
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Following along. We need to put 120 acres under an ag exemption.
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Old 09-09-2012, 09:32 AM   #44
Bily Lovec
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man,
look @ all these people trying to get out of paying their fair share of taxes...


whats next, food stamps ?


(slow morning, )
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Old 09-09-2012, 09:36 AM   #45
cosmiccowboy
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I will post the link to a great article that explains the difference between ag exemptions ( 1-D exemptions) and open space exemptions (1-D-1 exemptions)

The law is pretty clear on what you have to do to be a true "ag exempt".
According to the statutes, the landowner and the land must meet four
requirements as of January 1 of each
year.
• The land must have been devoted
exclusively to or developed continuously for agriculture during
the past three years.
• The owner’s primary occupation
and source of income are agriculture.
• The owner intends to use the
land for agriculture and as an
occupation or business for profit
during the coming year.
• The owner files an application by
sworn statement with the chief
appraiser before May 1 of each
year with all the documentation
required to determine the validity
of the claim. For good cause, the
chief appraiser may extend the
filing deadline 60 days.
After reviewing the application and
all the relevant information, the chief
appraiser must:
• approve the application and allow
the appraisal as agricultural use,
• disapprove the application and
request additional information or
• deny the application.

I suspect that there are very few posters in this thread that meet those legal qualifications.

On the other hand, the open space exemption qualifies the land only and not the owner. This is what most erroneously call an "ag exemption"
Open-Space Appraisal
(Section 1-d-1)
The other appraisal method, better
known as Open-Space or Section 1-d-1
land, requires the land, not the landowner, to qualify. The owner’s occupation, business and sources of income
are irrelevant.
According to the statutes, there are
three primary requirements for receiving the exemption.
• The land must be currently devoted principally to agricultural
use to the degree of intensity
generally accepted in the area.
• The land has been devoted
principally to agricultural use or
production of timber or forest
products for five of the preceding
seven years.
• The owner files a prescribed form
provided by the appraisal office
with the chief appraiser before
May 1 with all the necessary information to determine the validity of the claim. For good cause,
the chief appraiser may extend
the filing deadline 60 days.

Here is a link to the full article.

http://recenter.tamu.edu/pdf/1361.pdf

As an example on my place, the appraisal office came out and looked at the place. They carved out an acre around the house and appraised that at full (but still low) residential value. Then they took the rest of the place and valued it like I leased it out for grazing (agricultural
use to the degree of intensity generally accepted in the area.) so the value on the remaining property was only a few dollars an acre.

These guidelines should be standardized from county to county by state statute.

Last edited by cosmiccowboy; 09-09-2012 at 09:41 AM..
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Old 09-09-2012, 10:29 AM   #46
Silent Assassin
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Quote:
Originally Posted by Bily Lovec View Post
man,
look @ all these people trying to get out of paying their fair share of taxes...


whats next, food stamps ?


(slow morning, )
We pay our fair share of taxes! If politicians can find loopholes, why can't we do the same? We still pay chunk of our money to taxes but I want to also reduce some of that towards to our ranch.
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Old 09-09-2012, 10:43 AM   #47
Silent Assassin
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Quote:
Originally Posted by cosmiccowboy View Post
I will post the link to a great article that explains the difference between ag exemptions ( 1-D exemptions) and open space exemptions (1-D-1 exemptions)

The law is pretty clear on what you have to do to be a true "ag exempt".
According to the statutes, the landowner and the land must meet four
requirements as of January 1 of each
year.
• The land must have been devoted
exclusively to or developed continuously for agriculture during
the past three years.
• The owner’s primary occupation
and source of income are agriculture.
• The owner intends to use the
land for agriculture and as an
occupation or business for profit
during the coming year.
• The owner files an application by
sworn statement with the chief
appraiser before May 1 of each
year with all the documentation
required to determine the validity
of the claim. For good cause, the
chief appraiser may extend the
filing deadline 60 days.
After reviewing the application and
all the relevant information, the chief
appraiser must:
• approve the application and allow
the appraisal as agricultural use,
• disapprove the application and
request additional information or
• deny the application.

I suspect that there are very few posters in this thread that meet those legal qualifications.

On the other hand, the open space exemption qualifies the land only and not the owner. This is what most erroneously call an "ag exemption"
Open-Space Appraisal
(Section 1-d-1)
The other appraisal method, better
known as Open-Space or Section 1-d-1
land, requires the land, not the landowner, to qualify. The owner’s occupation, business and sources of income
are irrelevant.
According to the statutes, there are
three primary requirements for receiving the exemption.
• The land must be currently devoted principally to agricultural
use to the degree of intensity
generally accepted in the area.
• The land has been devoted
principally to agricultural use or
production of timber or forest
products for five of the preceding
seven years.
• The owner files a prescribed form
provided by the appraisal office
with the chief appraiser before
May 1 with all the necessary information to determine the validity of the claim. For good cause,
the chief appraiser may extend
the filing deadline 60 days.

Here is a link to the full article.

http://recenter.tamu.edu/pdf/1361.pdf

As an example on my place, the appraisal office came out and looked at the place. They carved out an acre around the house and appraised that at full (but still low) residential value. Then they took the rest of the place and valued it like I leased it out for grazing (agricultural
use to the degree of intensity generally accepted in the area.) so the value on the remaining property was only a few dollars an acre.

These guidelines should be standardized from county to county by state statute.
Posters? You mean posers? Who you calling posers? Just curious?

I communicated with my local CAD and asked tons of ?'s and have been informed what I needed to do and talked with CPA in Lockhart that does this stuff all the time for farmers and ranchers in Caldwell Co. We sat down and went over lots of things together about federal guideline. We are eligible. We are being active on our ranch, getting things ready to have fence put in and all to put livestocks on it so we can produce and make a record of it on yearly basis. I am going to be full time rancher when everything is all set on our property. I know I'm no posers. I have committed to do this on good faith and doing my part by learning things how to do this.

Even millionaires look for tax breaks. If federal law says what we can deduct from our tax then why y'all getting your pants in wad about it? Federal tax system wrote the tax codes, not us. Posers are for fake *** people who try to milk the system, that's not us! I put blood and sweat on this land to make a living since I can't find work anywhere so I'm gonna work on our land. Simple as that.

Last edited by Silent Assassin; 09-09-2012 at 10:49 AM..
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Old 09-09-2012, 10:58 AM   #48
cosmiccowboy
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Quote:
Originally Posted by Silent Assassin View Post
Posters? You means posers? Who you calling posers? Just curious?

I communicated with my local CAD and asked tons of ?'s and have been informed what I needed to do and talked with CPA in Lockhart that does this stuff all the time for farmers and ranchers in Caldwell Co. We sat down and went over lots of things together about federal guideline. We are eligible. We are being active on our ranch, getting things ready to have fence put in and all to put livestocks on it so we can produce and make a record of it on yearly basis. I am going to be full time rancher when everything is all set on our property. I know I'm no posers. I have committed to do this on good faith and doing my part by learning things how to do this.

Even millionaires look for tax breaks. If federal law says what we can deduct from our tax then why y'all getting your pants in wad about it? Federal tax system wrote the tax codes, not us. Posers are for fake *** people who try to milk the system, that's not us! I put blood and sweat on this land to make a living since I can't find work anywhere so I'm gonna work on our land. Simple as that.


Cool your jets cowboy. Poster as in you just posted in this thread. I'm not calling anyone a poser.

And all I did was post the state statutes defining ag use.

The state laws refer to property taxes and sales taxes. You can get reduced real estate appraisal as a 1-D-1 (open space) exemption, but you can't legally deduct sales tax unless you qualify as 1-D (ag exempt as defined by state law)

You are confusing state and federal as well. There are federal tax laws for running a second business that it appears you and CPA are referring to. I assume you are currently deducting ranch losses from your ordinary income earned elsewhere. That is perfectly legal and those loss deductions will be recovered by the IRS when you eventually turn a profit or sell the property.
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Old 09-09-2012, 11:02 AM   #49
GR5
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I'm not gonna get into the argument over all the qulifications. About 1/2 of our property is livestock and the rest timber. Livestock is a little better. each different survey is taxed seperately and you will benifit greatly if you can get the apprisal office to combine them. I bought a 42 acre tract and had to wait 6 years to get into ag. Yearly taxes were $1600, once into ag went to $52. Had another 10.5 acre tract that I had to wait on, was over $500 and went to $15.50
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Old 09-09-2012, 11:04 AM   #50
cosmiccowboy
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Quote:
Even millionaires look for tax breaks. If federal law says what we can deduct from our tax then why y'all getting your pants in wad about it? Federal tax system wrote the tax codes, not us. Posers are for fake *** people who try to milk the system, that's not us! I put blood and sweat on this land to make a living since I can't find work anywhere so I'm gonna work on our land. Simple as that.
I see that you edited and added the last paragraph. In that case you qualify for 1-D exemption since agriculture will be your primary occupation.

Good luck.
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