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Old 05-19-2021, 09:05 PM   #1
TAMU84
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Default ag vs wildlife exemption

I need to some help deciding if we want to keep a new piece of property we purchased (86 acres) under ag exemption or switch it to wildlife exemption. It is currently under 1-D-1. We have a small ranch in one part of the state that is strictly under ag and this new property is in another part of the state.

The main question I have is there any monetary differences. With our existing ranch we show income and expenses. Most things purchased for the ranch agriculturally are tax exempt. I believe the land taxes are deducted as an expense as well. Our CPA does our taxes so don't hold me to everything.

I was under the impression that with wildlife exemption you would have to pay sales taxes on products used. Example chemicals for spraying fence lines, shredding roads etc. I heard you also don't get a Texas Agricultural or Timber Registration number.

If you don't have income coming in with the wildlife exemption, can you still deduct items used, even if done to meet your management plan.

Also, can you deduct the taxes paid on the property?

If you can deduct everything just like an ag exemption it is a no brainer to switch this new property to wildlife exemption.
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Old 05-20-2021, 09:01 AM   #2
unclefish
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Ag (1-D-1) or Wildlife Exemptions are for property tax relief for each county. You apply for this with the county.

The State Comptroller's Office has sales tax exemptions for those involved in agricultural practices when buying certain goods. You have to apply for this with the state and get a certificate.

Both of these really have nothing to do with the other.

You can have a wildlife exemption for your property taxes and still have a sales tax exemption under Ag. Two totally different things.
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Old 05-20-2021, 09:10 AM   #3
Ag 89
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Originally Posted by unclefish View Post
Ag (1-D-1) or Wildlife Exemptions are for property tax relief for each county. You apply for this with the county.

The State Comptroller's Office has sales tax exemptions for those involved in agricultural practices when buying certain goods. You have to apply for this with the state and get a certificate.

Both of these really have nothing to do with the other.

You can have a wildlife exemption for your property taxes and still have a sales tax exemption under Ag. Two totally different things.
Also, if you are asking about deducting expenses that is even a different area. You can deduct business expenses on your income taxes. Your questions would be better answered by your accountant.
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Old 05-20-2021, 09:32 AM   #4
BrianL
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State sales tax: Yes it will cost you more because you will pay state sales tax. Not a big deal on smaller purchases, but for tractors, UTV, heavy equipment, it can add up in a hurry.

County Property Tax: Same wildlife as Ag

Federal income Tax: You will not get the same(if any) deductions for wildlife as Ag. It isn't a for profit. Example a tractor and equipment would be a 4 year depreciation. Depending on equipment cost and your tax bracket, that alone could easily save you $6K+/year in federal taxes. But if you aren't buying anything, or repairing anything, it won't help much.

One other thing is resale. I personally would MUCH prefer buying property that was under Ag as opposed to wildlife. It is easy to convert from ag to wildlife, but not as easy to go the other direction.

Last edited by BrianL; 05-20-2021 at 10:12 AM.
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Old 05-20-2021, 09:36 AM   #5
6.5 shooter
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I’m under wildlife exemption. I pay sales tax on all the stuff I buy, even tractors.
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Old 05-20-2021, 09:44 AM   #6
DUKFVR
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Originally Posted by 6.5 shooter View Post
Iím under wildlife exemption. I pay sales tax on all the stuff I buy, even tractors.
This. We are wildlife too. I like it better than ag exemption in our case. We can control when we let it get grazed etc. We bought our place to enjoy & wanted to give the animals the best habitat we can to fawn ,nest etc with good cover.
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Old 05-20-2021, 10:27 AM   #7
TAMU84
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There is so much misinformation out there. I talked to the agrilife people and was told that wildlife exemption is the same as ag exemption. Even get a card so you don’t pay sales tax. I don’t think that is true. They printed me out a lot of the information but never could find anything that was helpful

I doubt my account has any knowledge. They do a great job but doubt deal with wildlife exemptions regularly

Doing a lot of work on the place and spending money so would prefer to write off what I legally can
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Old 05-20-2021, 10:40 AM   #8
Throwin Darts
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Quote:
Originally Posted by TAMU84 View Post
I need to some help deciding if we want to keep a new piece of property we purchased (86 acres) under ag exemption or switch it to wildlife exemption. It is currently under 1-D-1. We have a small ranch in one part of the state that is strictly under ag and this new property is in another part of the state.

The main question I have is there any monetary differences. With our existing ranch we show income and expenses. Most things purchased for the ranch agriculturally are tax exempt. I believe the land taxes are deducted as an expense as well. Our CPA does our taxes so don't hold me to everything.

I was under the impression that with wildlife exemption you would have to pay sales taxes on products used. Example chemicals for spraying fence lines, shredding roads etc. I heard you also don't get a Texas Agricultural or Timber Registration number.

If you don't have income coming in with the wildlife exemption, can you still deduct items used, even if done to meet your management plan.

Also, can you deduct the taxes paid on the property?

If you can deduct everything just like an ag exemption it is a no brainer to switch this new property to wildlife exemption.
If you already have the other property and you show income and expenses and have an Ag exempt on it I would just run everything through there.
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Old 05-20-2021, 03:29 PM   #9
6.5 shooter
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Originally Posted by TAMU84 View Post
There is so much misinformation out there. I talked to the agrilife people and was told that wildlife exemption is the same as ag exemption. Even get a card so you donít pay sales tax. I donít think that is true. They printed me out a lot of the information but never could find anything that was helpful

I doubt my account has any knowledge. They do a great job but doubt deal with wildlife exemptions regularly

Doing a lot of work on the place and spending money so would prefer to write off what I legally can
Your sales tax is governed by the Texas state comptroller. Go read it for yourself.
Wildlife exemption does not qualify.
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Old 05-22-2021, 05:19 PM   #10
stickbow
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ag and wildlife exemption is for property tax only. you must be involved in commercial timber or ag business such as crops cows pigs goats etc with that you are your company then gets ag timber number to avoid sales tax have to be producing product per the state. You can write off as business expense with out but have to pay sales tax unless you have ag timber number. easy to get if you qualify just go to state web site
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Old 05-22-2021, 05:59 PM   #11
brokeno
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Ag
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Old 06-01-2021, 10:47 AM   #12
MikeSSS
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We changed over to wildlife exemption about 8 years ago, we just didn't want cows on on the place anymore. you will have to pay sale tax on the stuff you buy for the property. you will have to submit a wildlife management plan to the appraiser to get started and a new one every 5 years along with a annual report yearly. Kind of a pain but once you do it a few times you learn what there looking for. You'll also have submit receipts & pictures of wildlife management practices. Good luck & have fun.
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Old 06-01-2021, 10:54 AM   #13
Hogmauler
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Neither one of these reduce school taxes though do they?
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Old 06-01-2021, 11:32 AM   #14
Capp35
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Unfortunately you have to have an existing Ag permit to get a wildlife exemption.
You can not just skip directly to wildlife, unless the laws have changed?
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Old 06-01-2021, 11:33 AM   #15
Capp35
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Also, there are people that will put Bee hives on your property to get you the Ag exemption, if you don't have livestock or farm.
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Old 06-01-2021, 11:35 AM   #16
Hogmauler
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You e got five years of increasing taxes to deal with if you don’t have an ag exemption. I’ll never buy another piece of property without it.
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Old 06-01-2021, 12:13 PM   #17
rolylane6
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Originally Posted by Hogmauler View Post
You e got five years of increasing taxes to deal with if you donít have an ag exemption. Iíll never buy another piece of property without it.
Yep, I'm in that boat now. I bought my place 8 years ago and the previous owner let his run out. I've been slowly fixing fences so I can get a few cows and start getting my 5 years on the books. Like you said tho, I'll pay dearly for the next 5 years for my procrastination thus far. Hopefully by January I'll be ready. I don't intend to ever buy another one but if I do, it will have ag already.

Sent from my SM-N970U using Tapatalk
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Old 06-03-2021, 08:07 AM   #18
txbowman12
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Originally Posted by Capp35 View Post
Also, there are people that will put Bee hives on your property to get you the Ag exemption, if you don't have livestock or farm.
Bee exemption is for properties between 5-20 acres if Iím not mistaken
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Old 06-03-2021, 08:09 AM   #19
tdwinklr
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Quote:
Originally Posted by unclefish View Post
Ag (1-D-1) or Wildlife Exemptions are for property tax relief for each county. You apply for this with the county.

The State Comptroller's Office has sales tax exemptions for those involved in agricultural practices when buying certain goods. You have to apply for this with the state and get a certificate.

Both of these really have nothing to do with the other.

You can have a wildlife exemption for your property taxes and still have a sales tax exemption under Ag. Two totally different things.
ditto.
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Old 06-20-2021, 01:02 PM   #20
Deerguy
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Quote:
Originally Posted by unclefish View Post
Ag (1-D-1) or Wildlife Exemptions are for property tax relief for each county. You apply for this with the county.

The State Comptroller's Office has sales tax exemptions for those involved in agricultural practices when buying certain goods. You have to apply for this with the state and get a certificate.

Both of these really have nothing to do with the other.

You can have a wildlife exemption for your property taxes and still have a sales tax exemption under Ag. Two totally different things.
Lots of folks need to re-read this as it is 100% correct. Two entirely different things. Part of the problem is in the terminology used. For county tax purposes, there is no ag or wildlife 'exemption'. It is a 'valuation', or, how your property is valued for tax purposes. There is no difference at all between the ag valuation (1-D-1) and the wildlife valuation as they are the same thing. Wildlife Management is just a qualifying use to maintain the ag. You never really switch anything. If you do wildlife management, you are still in ag. The sales tax exemption is handled through the comptrollers office. Entirely different.
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Old 06-29-2021, 10:09 PM   #21
dropTopTx
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Originally Posted by rolylane6 View Post
Yep, I'm in that boat now. I bought my place 8 years ago and the previous owner let his run out. I've been slowly fixing fences so I can get a few cows and start getting my 5 years on the books. Like you said tho, I'll pay dearly for the next 5 years for my procrastination thus far. Hopefully by January I'll be ready. I don't intend to ever buy another one but if I do, it will have ag already.

Sent from my SM-N970U using Tapatalk
Check out the Ecolab program. It provides access to private property for ecological research. I purchased the initial part of my property without an ag or wildlife exemption and was not looking forward to 5 years of ag production to get an exemption.

Basically you enroll in the program and provide a profile of the property. Different researchers review properties and then submit proposals about what they want to study. You get matched up with a few researchers and you provide grant money to the universities (TAMU, tu, Tech, etc.). These grants are tax deductible donations to university. When I went thru the program it only lasted two years and then I was immediately granted a wildlife exemption. Looking at the firm that I worked with it looks like they have extended the duration but it may still be worth it.

The research, at least in my case, was not invasive at all. Each of the research teams visited the property probably 3 times or less. Some of the studies were:
-Looking for invasive crazy ants - didnt find any
-Lice impacts on pocket gophers - they dug a few holes to try and trap pocket gophers and took a few samples away
-Sugars in johnson grass - just pulled up a handful of sample plants
-Bug samples for TAMU - I can now say my bugs are part of the largest bug collection in the world!

This is the law firm that helped me - you pay them a few bucks but they handle the whole thing. Definitely worth investigating!
https://braungresham.com/texas-ecolab/
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Old 06-30-2021, 08:51 AM   #22
rolylane6
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Originally Posted by dropTopTx View Post
Check out the Ecolab program. It provides access to private property for ecological research. I purchased the initial part of my property without an ag or wildlife exemption and was not looking forward to 5 years of ag production to get an exemption.



Basically you enroll in the program and provide a profile of the property. Different researchers review properties and then submit proposals about what they want to study. You get matched up with a few researchers and you provide grant money to the universities (TAMU, tu, Tech, etc.). These grants are tax deductible donations to university. When I went thru the program it only lasted two years and then I was immediately granted a wildlife exemption. Looking at the firm that I worked with it looks like they have extended the duration but it may still be worth it.



The research, at least in my case, was not invasive at all. Each of the research teams visited the property probably 3 times or less. Some of the studies were:

-Looking for invasive crazy ants - didnt find any

-Lice impacts on pocket gophers - they dug a few holes to try and trap pocket gophers and took a few samples away

-Sugars in johnson grass - just pulled up a handful of sample plants

-Bug samples for TAMU - I can now say my bugs are part of the largest bug collection in the world!



This is the law firm that helped me - you pay them a few bucks but they handle the whole thing. Definitely worth investigating!

https://braungresham.com/texas-ecolab/
Thanks, I'll definitely look into that.

Sent from my SM-N970U using Tapatalk
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