How does state law define Agricultural Forest land?
Under state law (sec. 70.32(2)(c)1d, Wis. Stats.), effective since January 1, 2005, Agricultural Forest land is land producing or capable of producing commercial forest products if the land satisfies any of the following conditions:
- It is contiguous to a parcel classified in whole as Agricultural land, if the contiguous parcel is owned by the same person who owns the land that is producing or capable of producing commercial forest products. In this subdivision, "contiguous" includes separated only by a road.
Review questions 2-9.
- It is located on a parcel that contains land classified as Agricultural land in the property tax assessment on January 1, 2004, and on January 1 of the year of assessment. Review questions 11-12.
- It is located on a parcel where at least 50 percent of the acreage, was converted to land classified as Agricultural land in the property tax assessment on January 1, 2005, or thereafter.
Review questions 13-15.
Parcels qualifying under condition "a" in Question 1, review Questions 2-10
What classifies a parcel in whole as Agricultural land?
A wholly Agricultural parcel is one that the assessor classified
entirely as Agricultural land (Class 4) in the assessment roll.
Note: Review question #6 (below) for the one exception to this.
Does Forest land qualify as Agricultural Forest if the forest acres are contiguous to a wholly Agricultural parcel?
Yes. It qualifies if the contiguous Forest land has the
same owner as the wholly Agricultural parcel.
Does the qualifying Agricultural Forest parcel need to be completely forested?
No. However, the forested acres must be contiguous to the wholly Agricultural parcel to qualify as Agricultural Forest.
Can an owner have qualifying Agricultural Forest acres in more than one parcel?
Yes. However, the contiguous Forest land must be in the parcel or parcels contiguous to the wholly agricultural parcel.
Is a parcel containing 39 acres of Agricultural land (Class 4) and one acre of "Road right-of-way" (Class 5) considered a wholly agricultural parcel?
Yes. The Wisconsin Department of Revenue considers the parcel as described a wholly agricultural parcel. Any acres listed to road right-of-way do not disqualify the parcel.
If there are parcels that are touching at only one point, are they considered contiguous parcels?
Yes. Parcels touching at only one point are contiguous.
In some cases the assessment roll may combine two forties (or several forties) under one parcel number. Are the combined forties considered a parcel?
Yes. Under state law the combined forties are considered a parcel since a parcel number was assigned to that defined area of land.
Is the following parcel considered wholly Agricultural? A forty with a classification of 40 acres of Agricultural land (Class 4) and an improvement assessment of $5,000 for a well (Class 7 "Other" improvement). There are no site acres (Class 7 "Other" land) included for this parcel.
Yes. All acres are classified as Agricultural. The improvement assessment for the well does not disqualify the parcel from being wholly Agricultural. If the assessment roll has Class 7 site acres, then the parcel is not considered wholly Agricultural.
If woods adjoin Conservation Reserve Program (CRP) land, are the woods considered Agricultural Forest?
Yes. CRP land is classified as Agricultural land. If all other qualifications are met, Forest land contiguous to CRP land is classified as Agricultural Forest.
Parcels qualifying under condition "b" in Question 1, review Questions 11- 13
Do forest acres located within a parcel also containing Agricultural land, qualify as Agricultural Forest acres?
Yes. The Forest acres qualify as Agricultural Forest if the parcel contains land classified as Agricultural land in the 2004 assessment roll and in the current assessment year.
Is there a minimum number of Agricultural or Forest acres required to qualify as Agricultural Forest?
No. There are no acreage limitations to qualify under condition "b" (from question 1) above. If the Agricultural acres exist within the parcel in the 2004 assessment roll and the current assessment roll, the Forest acres qualify as Agricultural Forest.
If a forest is located in a parcel with multiple classifications, does it qualify for Agricultural Forest?
Yes. If the parcel contained Agricultural land in 2004 and in the current assessment year, the forested acres qualify as Agricultural Forest. Additional classifications such as Residential, Commercial, Undeveloped, or Other (agricultural home site) do not disqualify the Agricultural Forest Classification.
Parcels qualifying under condition "c" in Question 1, review Questions 14-16
Do the forested acres located in a parcel where land was converted to Agricultural land qualify as Agricultural Forest?
If the parcel did not contain Agricultural acres in the 2004 assessment roll, at least 50 percent of the parcel's total acreage must be converted to Agricultural land for the Forest acres to qualify as Agricultural Forest.
In this example, do the 25 acres of forest qualify as Agricultural Forest for the current year? Example: A 40-acre parcel was classified as 40 acres of Forest in 2004. In the current assessment year, 15 of these acres are classified as Agricultural land and 25 acres as Forest land.
No. At least 50 percent of the acreage (in this case at least 20 acres) must be converted to Agricultural in the current year for the forest acres to qualify as Agricultural Forest.
How do the "Road right-of-way (ROW)" acres classified as Undeveloped land (Class 5) affect the 50 percent acreage measurement?
ROW acres are included in Agricultural land acres for measurement of the 50 percent threshold.
Example: A 40-acre parcel contains 19 acres of Agricultural land (Class 4), one acre of ROW (Class 5), and 20 acres of Forest land. In this case, at least 50 percent of the parcel's total acreage is Agricultural land.
Split or Combined Parcels
How does an assessor decide whether a split parcel or a combined parcel (two parcels legally joined as one) in the current assessment year qualifies for Agricultural Forest?
An assessor should use the same rules as those for newly created parcels with separate legal descriptions (split from their original parcel or combined parcels into one).
Forest within the new parcels qualify for Agricultural Forest by:
- Being contiguous to a wholly agricultural parcel with the same owner
- Containing agricultural acres in 2004 and in the current assessment year. The Agricultural acres for 2004 need to be located within the boundaries of the current assessment year's parcel.
- If no Agricultural acres existed in 2004, but at least 50 percent of the acreage is converted to agriculture in the current assessment year
Parcels in the Managed Forest Law (MFL) program
Do the guidelines for Agricultural Forest assessment adjustments apply to land enrolled in the Managed Forest Land (MFL) and Private Forest Crop (PFC) programs?
Yes. If any of the qualifications of Agricultural Forest are met, the values of land enrolled in MFL or PFC should be adjusted in the same manner as taxable forest property. If the contract is broken, penalties are collected based on what the taxes would have been if the land was not enrolled in the program. Therefore, assessments of land enrolled in MFL or PFC must be equitable with similar land not enrolled in those programs. The assessor should inform the property owner under state law (sec.70.365, Wis. Stats.), of the assessment change.
In this example, what criteria should be used to determine if Agricultural Forest exists?
Example: For 2004 a parcel's acreage was classified entirely as MFL; however, some acreage within the parcel was used for agricultural purposes. For the current assessment year the parcel is no longer in MFL; however, the agricultural use continues.
MFL parcels receiving use value due to agricultural use are treated as if an Agricultural classification exists. If an MFL parcel received agricultural use values in 2004, in the current assessment year this parcel (whether remaining in MFL or not) qualifies for Agricultural Forest by having any amount of acreage devoted primarily to agricultural use.
If you have additional questions on Agricultural Forest and Undeveloped land classification and valuation, contact the appropriate
Equalization Bureau District Office.
FOR QUESTIONS OR COMMENTS CONTACT:
WISCONSIN DEPARTMENT OF REVENUE
Division of State and Local Finance
PO Box 8971
Madison, WI 53708-8971
Fax: (608) 264-6897