I just purchased/inherited a parcel with AG on it what do I need to do?
If you have recently
purchased, acquired, or inherited land, typically you will be required to file
an application in the following year. Also, a new application would be required
if a property changed size or had new ownership in the prior year. Applications
can be filed timely from January 1st through April 30th.
If you would like to verify if your property currently has the AG valuation on
it, please visit WCAD.org.
How many acres do I need to qualify for AG?
The Texas Comptroller
defines the minimum acreage requirements are, “to the degree of intensity
typical in the area.” The acreage requirements vary depending on the AG use and
the typical acreage requirements can be found on the WCAD Website.
How many animals do I need on my property to qualify for AG valuation?
The number of animals needed for a property to qualify for Ag Valuation
depends on location in the county, type of forage, and type of animal. Refer to
our AG animal estimator.
What if my property has AG and I purchase the parcel next to it that does not have AG?
The history requirements
(time-period test) will still need to be established for that parcel even
though it is next to a qualifying parcel with the same ownership. Please note
that the intensity, use and history requirements will need to be met in
addition to the history requirements.
Effective Acreage
Tracts of land that do
not meet the minimum acreage may qualify if used with a larger operation that
meets or exceeds the qualifications. To be considered part of a larger
operation, the primary operation must be within a reasonable distance of the
smaller tract for a prudent operator to justify the travel and expense and be
worked by the same operator. Documentation of lease, cuttings, planting,
harvesting or other proof may be required for the tract that does not meet the
minimum requirements. Beekeeping will need to be on a standalone basis.
What if my neighbors and I work together?
Primary use, intensity,
and history will have to be met. These parcels will typically have gates
between them so that the livestock can move between parcels. Beekeeping will
need to be on a standalone basis.
What if my property is part of a family tract?
If a small tract is used
as part of a larger family operation, it may qualify. Written verification of
participation in a larger family operation may be requested by the Appraisal
District. These tracts must pass all eligibility requirements except size and
be continuously used to support a larger farm or ranch in close proximity. All
contiguous parcels can be considered on a stand-alone basis with consideration
being given to common ownership.
Do I have to own the animals to qualify?
No. If your land is
being primarily used for agricultural use, it can still qualify. You can lease
your land to someone who will operate your land for agricultural use. It is
your responsibility to see that the owner of the animals is using your land to
the typical degree of intensity required to keep the agricultural appraisal.
Do I need to have a business?
The law does not require that agriculture be the primary occupation and
primary source of income of the landowner nor that the use of the land be an
occupation or a business venture for profit.
Livestock operations
These are ventures that
raise and keep cattle, sheep, or goats. Operations can be described as cow and
calf operations, cattle stocker and feeder operations, sheep operations for
meat or wool production, or goat operations for meat or mohair production.
If my land is inside the city will it qualify?
If the land is located within the boundaries of a city or town, one of
the following requirements must be met in addition to the normal requirements:
(1) The city must not provide the land with general services comparable to
those in other parts of the city having similar features and population and/or
(2) must have been devoted principally to agricultural use continuously for the
preceding five years.
Can I rest my land?
Land may be idle for a reasonable period, general one (1) year, due to
agricultural necessity and still be considered in agricultural production (does
not qualify for properties inside the city limits).
Drought
Eligibility of land for
open space appraisal does not end because the land ceases to be devoted
principally to agricultural use to the degree of intensity generally accepted
in the area if: (1) a drought declared by the Governor creates an agricultural
necessity to extend the normal time the land remains out of agricultural
production; and (2) the owner intends to resume the use the land in the manner
and to the degree of intensity at the end of the declared drought.
Why was AG taken off the property?
Typically, a new application is required whenever a parcel is purchased,
ownership changes and/or the parcel changes in size. The application is
typically needed in the year following the purchase/ownership change/size
change. If an application is not received, then the special valuation expires.
Could I qualify for an AG appraisal if I lease my land for hunting?
No. Hunting does not qualify the land and is not considered an
agricultural activity.
Can I hunt on my AG land or lease my land for hunting and keep my AG appraisal?
If your land is
primarily used for agricultural purposes to the degree of intensity required by
this county for the majority of the year and hunting is a secondary use, not
the primary use, then you can keep receiving this special appraisal.
What is dry crop?
Cropland operations
include growing small grain crops, sorghum hay, improved grass hay, and row
crop. Hay is baled twice a year.
Why is my one acre out for homesite?
We will generally take
one acre out for any homesite even if it is temporary like a hunting cabin or
only used on an occasional basis.
Are agricultural exemptions and agricultural appraisals the same thing?
No, they are not the
same thing. Application for agricultural valuation is only available through
this office. Agricultural exemptions for machinery and equipment items that are
used in the production of farm or ranch products or of timber, regardless of
their primary design, are implements of husbandry and are exempt from ad
valorem taxation.
Texas agricultural sales tax exemption
If you are in a
qualified farm or ranch industry, certain items you purchase that are used in
the production of agricultural and timber products are exempt from sales taxes.
This is only available by application through the Texas
Comptroller of Public Accounts. Applying and receiving the
agricultural appraisal in this office is different than receiving the Texas
agricultural sales tax exemption. Our office does not issue a tax id number for
the use of buying products for agricultural purposes.
Where do I get a farm tax ID#?
Through the Texas
Comptroller’s office. You may click on the link below and apply online here.
What type of tax savings would I get if my property qualifies for AG?
The tax savings that a
property receives depends on the current market value of the property and the
use type for the ag valuation. Native pastures areas can have a lower AG
valuation than dry crop areas and generally both are lower than the market
value that the taxes would normally be based on. Please review the production values for additional
information.
How are the production values set for Agricultural properties?
Cropland values are based on a five year
average of typical income minus typical expenses using a share lease method.
Pastureland values are based on typical income minus typical expenses using a
cash lease method.
Wildlife
Is an alternative agricultural appraisal for taxpayers with property
that is devoted to propagating, sustaining, and breeding of a migrating, or
wintering population of indigenous wild animals through implementation of a
Wildlife Management Plan.
What is a wildlife management plan?
In addition to the
application, a wildlife management plan shall be completed on a form supplied
by the Texas Parks and Wildlife Department for each tract of land for which
wildlife management use is sought. If the wildlife management plan is for A
Wildlife Management Association, the form must be signed by all the parties
involved with implementing the wildlife management plan.
Requirements for wildlife
To receive a Wildlife
Management Appraisal the parcel must meet the following:
- currently receiving AG Appraisal
- primarily devoted to Wildlife Management
- actively being managed to sustain a breeding, migrating, or wintering population of indigenous wildlife
- each year for which the owner seeks to qualify the tract for wildlife management use, the landowner has selected at least 3 wildlife management practices to the degree of intensity required.
- Wildlife management practices include:
- habitat control
- erosion control
- predator control
- providing supplemental supplies of water
- providing supplemental supplies of food
- providing shelters; and
- making census counts to determine population
Do I have to have AG before getting wildlife?
Yes, the property must
first qualify for AG. To qualify for agricultural appraisal under wildlife
management use, land must have qualified and been appraised as agricultural
land in the prior year.
Do I have to turn in an AG application with an annual wildlife report or 5-year plan?
When submitting a 5-year
plan, an AG application needs to be submitted with it. When submitting an
annual report, an application is not needed.
I let wild deer graze my land; does my land qualify?
No. Permitting wild deer
to eat natural vegetation is not an agricultural use. Wild animals surviving on
natural ground cover are not livestock.
I manage my land for whiletail deer (or other native wildlife): does my land qualify?
Potentially. Please
visit the Texas Parks and Wildlife website for more
information on wildlife management. If you meet the criteria, you must complete
a wildlife management plan along with a new AG application when converting from
traditional agriculture to wildlife management.
Which is cheaper, traditional AG use land or wildlife management land?
Neither. The values for
both are calculated using the same agricultural land value tables and are based
on AG land type.
I have axis deer and blackbucks. Why can't I apply for wildlife management?
Wildlife management is
for land devoted to managing indigenous wildlife. Having or raising exotics on
your land does not meet the qualifications of wildlife management.
Agriculture application
Disclaimer: Please
retain proof that an application has being filed. It is the applicant’s
responsibility to be sure that the application has been received. The Appraisal
District will review each application in the order it was submitted. The
appraisers reviewing your application will use aerial photographs and on-site
inspections combined with the application and any other supporting evidence to
reach a decision. For fastest processing, please submit the application prior
to March, as the majority of the applications are submitted in March and April.
I just purchased a property that has AG on it, what should I do?
If the property you have
recently purchased was designated for use as agricultural land and was
previously receiving the AG-use valuation and if you would like to continue the
use of the land, you would need to keep the property in some type of AG-use
such as farming or ranching. The property must currently be in AG-use and the
principal use must remain agricultural use when you apply for the AG-use
valuation.
How do I fill out the AG application?
Where do I get an application?
What is the AG application deadline?
Timely received
applications deadlines are between January 1 and April 30. Late applications
can be received until we certify the appraisal roll (typically in mid-July),
but a 10% penalty is added. Once the Appraisal Review Board approves the
appraisal roll, you cannot apply for agricultural appraisal for that year.
How does this 10% penalty work for filing a late application?
For the portion of the
account in AG, it is 10% of the market value taxes.
I received this agricultural application in the mail. Why?
There are a variety of
reasons as to why an application was received including but not limited to the
following: You may receive the application because the appraiser needs to know
how you qualify or notices a change in your farm and ranch practices. You may
have gotten the application because the Chief Appraiser is requesting an
update. If you are still using the property for agricultural purposes, then you
must complete the application and submit it to the WCAD on or before April 30
to continue to receive this special use appraisal. If it is not completed, the
land will lose this special use appraisal and be assessed at market value. If
the form is returned and approved after April 30 but before certification of
the appraisal roll (typically in mid-July), then the property will receive a
penalty equal to 10% of the tax savings resulting from the agricultural appraisal.
A new application must be filed when there is a change of ownership. If a
person fails to file a valid application on time, the land is ineligible for
agricultural appraisal for that year.
Do I have to fill out an application every year?
Once you receive
agricultural appraisal, you do not have to apply again in subsequent years
unless your qualifications change including ownership, size, land use changes,
or if the Chief Appraiser requests a new application.
What if my property is in two counties?
If the tract of land
crosses county lines, then an application must be filed with the Appraisal
District in each of the counties.
My land has always been in AG. Do I still need to apply?
Yes. A person claiming that their land is eligible for the agricultural
appraisal must file a valid application with the Chief Appraiser. Agricultural
valuation cannot be granted without a valid application from the current owner.
Keep in mind, ownership changes include transferring land to another party,
transferring land into a trust, adding a party to the ownership, or deleting a
party from the ownership.
What if I am granted AG?
You will receive a
letter by regular mail if your application is granted. You should retain this
letter for your records. Also, you can visit WCAD.org and
use the property search feature to see if the AG valuation has been applied to
your account.
What if I am denied?
If the Appraisal
District determines that your property or your operation does not meet the qualification
standards, it will deny your application. This denial can be all or in part.
For example, the Appraisal District may grant some of your acreage but deny a
part of it. If you are denied, you will receive a letter notifying you of the
denial by certified mail. The information in the letter will inform you of your
right to appeal the decision. You will have 30 days from the date of the letter
to apply for a formal hearing with the Appraisal Review Board.
The Appraisal Review
Board (ARB) is a panel of several local property owners who hear appeal cases.
They have the authority to order the District to make a change to the appraisal
roll. If you feel your property has been denied in error, you can make your
arguments to the ARB. The Appraisal District will also present their arguments
in the matter. The ARB will hear both sides, deliberate and decide during the
open meeting in the presence of all parties.
If the ARB upholds the
Appraisal District’s decision, you have the right to appeal to District Court.
But, by law, you must first have the ARB hearing before taking the step to
appeal to the court.
What is a rollback?
An AG rollback tax is an
additional tax that is imposed when a property owner changes the use of
a property from agricultural to any other use – excluding building a house for
a personal homestead. The rollback tax recoups the tax the owner would have
paid if his or her land had been taxed at market value for the years covered in
the rollback. More information can be found in Section 23.55 of the Texas
Property Tax Code.
What are some examples of potential changes of use?
- A tract has been in pasture and appraised as special use productive AG land. The land is converted to a commercial development.
- A tract has been appraised as wildlife on the appraisal rolls and is converted to a residential subdivision.
Either of these situations, or similar situations, can prompt a change of use investigation. A determination of change of use will be sent by certified mail to the owner of record by the Appraisal District and the owner can appeal to the ARB by making a protest application within 30 days of the determination notice.
Rollbacks and homesteaded properties
Section 23.55,
Subsection (i) of the Texas Property Tax Code states, “The use of land does not
change for purposes of Subsection (a) of this section solely because the owner
of the land claims it as part of his residence homestead for purposes of
Section 11.13 of this code.”
How is the rollback calculated?
Section 23.55 of the
Property Tax Code establishes the criteria for rollback/change of use and per
this section of the Property Tax Code, if your land qualified for agricultural
appraisal and you change its use to a non-agricultural use, you may owe a rollback
tax for each of the previous three years (the rollback will potentially be for
five years if the change of use was before 9/1/2019) in which your land
received the lower appraisal. The rollback tax is the difference between the
taxes you paid on your land’s agricultural value and the taxes you would have
paid if the land had been taxed on its higher market value. Additionally, 5%
compounding interest (7% compounding interest if the change of use was before
9/1/2019) is charged for each year from the date that the taxes would have been
due.
Who is liable for the rollback tax?
Typically, this is
decided between the buyer and seller.
Will this parcel be rolled back on?
WCAD is unable to
provide predeterminations regarding the potential of a future rollback on a
property.
What is the rollback amount going to be on a property?
If a rollback estimate
is requested, the requestor can email ElainaW@wcad.org. The requestor will need to
provide the change of use date and the acreage amount. The change of use date
will be the date dirt was or will be turned and the acreage will be the number
of acres that are being or will be developed. Once WCAD has completed their
portion, the requestor will need to email it to the Tax Office to get the
actual estimate. The WCAD email contains the Tax Office information.
Was there rollback on a specific parcel?
What are some examples of supporting documentation that I should bring to an AG, special valuation and/or rollback tax protest?
- Contracts or receipts for land maintenance services including, but not limited to sprigging, cutting, baling, fertilizer, herbicide, fence and/or installation and repair, pond construction. Documents should indicate number of acres serviced, date of service, and product types where applicable.
- Sales receipts (bills of sale) on livestock
- Expense receipts
- Production and breeding records
- Sworn affidavits
- Invoices for equipment purchases
- Registration papers for breeding operations
- Current contract with government program
- Picture evidence
- Documentation of activities performed regarding wildlife management
- Lease agreements indicating the usage of the property (i.e., type of crop, crop plant and harvest dates, type and number of livestock, grazing timeframe, etc.)