Thursday, February 13, 2014

Palladium-Item Reports Farmland Assessments Continue to Rise

From Richmond Palladium-Item:

Prosperous years on the farm mean farmland assessments will increase again for taxes paid in 2015.

The base rate for farmland for taxes paid next year will be $2,050 per acre, a 16 percent increase over the base value of $1,760 for farmland for taxes collected this year.

The 2014 base assessment is an 8 percent increase over 2013, said Purdue agricultural economist Larry DeBoer.

Agriculture’s rising land values have resulted in ag property taxes rising by 33 percent since 2007, DeBoer said.

Farmland rents have increased, as have the price of corn and soybeans until recently, which is data that is used to estimate the income earned from farming an average acre, DeBoer said.

Some property tax experts have argued farmland assessments are too low. The base rate per acre was $1,760 in 2013 for taxes paid this year, while the market value of an an average acre of farmland was $7,446, which means farmland is assessed at about one-fourth of its market value, DeBoer said.

“Farmland gets a huge tax break from the assessment process, despite the base rate increases,” DeBoer said.