Agricultural classification is a tax savings benefit for property owners that use their land for bona fide commercial agricultural uses. "Bona fide use" means good faith, commercial agricultural use of the land with the intent of earning a profit. This benefit results in the land being valued based on the probable income from normal agricultural use. This is often substantially less than market value. The agricultural use must be in place on or before January 1st of the year which the ag classification is requested. Only the land value portion of the property that is being used for agriculture can receive the classification. (Florida Statute 193.461)
Questions and Answers
Have you ever wondered if your property qualifies for agricultural classification? Or, if you already have ag classification and want to introduce agritourism activities to your property, how may your agricultural classification be affected?
Please check out our new Ag Classification Questionnaire
Will Agricultural Classification affect my Homestead Exemption?
You may qualify for Homestead Exemption and Agricultural Classification on your property. The portion of land and any buildings that are primarily used for your residence is considered your homestead and will be assessed separately (at minimum is generally one acre). By applying for Agricultural Classification on homesteaded property, you certify that some of the land is used primarily for commercial agriculture. The land used for the commercial agricultural operation is excluded from the Homestead Exemption and other assessment limitations including the Save Our Homes Benefit (Portability).
Each year, the amount of the Save Our Homes Benefit (Portability) that you have accrued is shown on your Notice of Proposed Property Taxes. If you decide to apply for agricultural classification on your homestead property, you will be limiting your homestead land, thereby reducing your portability should you decide to sell your home and take your accrued Save Our Homes benefit with you. Over time, the agricultural classification annual savings may outweigh the one-time portability in homestead savings, but it will not outweigh the potential tax savings after a new home is purchased.
In cases involving homestead properties, it is typically more beneficial to forego the Agricultural Classification in order to protect the property from future assessment increases in case you or your tenant stop using your land for commercial agriculture or if you decide to sell the property.
My neighbor said I can get an agricultural exemption to lower my property taxes on my land that’s zoned for agriculture. How many cows do I need to put on the property to qualify?
There is no agricultural exemption. However, there is an agricultural classification for land used primarily for "bona fide commercial agricultural purposes." Bona fide agricultural purposes means good faith, commercial agricultural use of the land with the intent of earning a profit (personal uses or hobbies do not qualify). (Florida Statute 193.461)
Please see the Agricultural Use Guidelines for Cattle below.
Can you “pre-approve” my proposed commercial agricultural use?
The Property Appraiser cannot pre-approve agricultural use classifications. The granting of all or part of an application for agricultural classification is made only after all relevant information on the parcel has been analyzed by the Property Appraiser. A determination by the Property Appraiser on whether or not agricultural classification is approved will be made on or before July 1st.
How do I apply for agricultural classification?
Complete the Agricultural Application Packet and return it to the Property Appraiser’s office.
- January 1st is the statutory assessment date. Therefore, the property must be in bona fide commercial agricultural use, or reasonable effort must have been made and continues to be made, on this date.
- The application must be signed and returned by March 1st
- Provide supporting documentation with application (see guidelines below)
If you are leasing your land to another party, then a written lease is required and must be included with your application. Bona fide leases shall include:
- A start date and an end date. The lease must be in effect on January 1st.
- Names of the land owner and tenant (lessor and lessee)
- Number of acres leased
- Address or legal description of parcel leased
- Rental rate per unit (acre, etc.)
- Use of the leased land
- Terms of the lease
- Must be arm’s length (unrelated parties).
A lease alone is not sufficient evidence that a parcel is in commercial agricultural use. A copy of the tenant’s IRS Form 1040F or equivalent from the most recent year’s federal tax return must be submitted with the application. If you lease your property to a tax-exempt organization, a copy of their 501(c)(3) status must be submitted with the application.
- All information submitted will be held in strict confidence, as mandated by Florida Statute 195.027.
- All applications are field checked to verify the usage and to ensure correct assessments.
- If equipment or machinery is being used for the commercial agricultural use, a Tangible Personal Property Tax Return ( Form DR-405) must be submitted with the application.
What if my application is approved?
- If the agricultural classification is approved, it will be shown on the annual Notice of Proposed Property Taxes that is mailed in August.
- The value on the approved acres will be assessed at a lower value, which is determined by the agricultural use. Only the acreage that is actually used for the agricultural operation can be approved. The classification does not blanket your entire property. Agricultural classification applies to land only. It does not apply to improvements on the land, such as barns and stables.
- Additional information will be requested on a regular basis from the property owner to determine the continuance of eligibility. This information is usually in the form of IRS Form 1040F or equivalent from the most recent year's federal tax return. For verification purposes, a Request for Transcript of Tax Return (IRS Form 4506-T) may also be requested.
- If for any reason we determine your agricultural operation does not continue to meet the proper criteria, you may be denied.
- If your agricultural business changes (increase or decrease in acreage, change in use, etc.), please contact our office immediately.
What if my application is denied?
If your application for agricultural classification is denied, you will receive a denial letter on or before July 1st. The letter will explain the appeal process.
What happens to the agricultural classification when the property is sold or ownership is changed?
When the property is sold, the agricultural classification is removed and a new application must be made on the Agricultural Application Packet. It is the responsibility of the property owner to notify this office of any change in the status or use of the property with an agricultural classification. Failure to provide this information could result in incorrect assessment of your property or the loss of agricultural classification. Please note that it is unlawful to give false information for the purpose of continuing the agricultural classification of lands.
What happens when I stop using my land for commercial agriculture?
Warning! When the agricultural classification is removed, the land that has been assessed at a low agricultural use value will be reset to the current market value. This reset of value will cause a significant increase in property taxes because agriculturally classified land is not protected by homestead exemption or other assessment limitations.
Agricultural Use Guidelines
- Proper care and management of the land must be evident, and records must be provided upon request. This data will be compared to typical operations.
- Production and sale of livestock or crops must be present. Production or ownership for personal use does not qualify.
- Additional information, including a current lease or tax return, will be requested on a regular basis to document bona fide commercial agricultural use.
- Tax returns will be requested on a regular basis to document bona fide commercial agricultural use. The IRS presumes that an activity is carried on for profit if it makes a profit during at least 3 of the last 5 tax years, including the current year – at least 2 of the last 7 years for activities that consist primarily of breeding, showing, training or racing horses. Otherwise, your farm is considered a hobby under these guidelines.
In November 2016, Florida beekeepers, county property appraisers and industry representatives came together at a meeting of the Florida State Beekeepers Association to discuss professional standards and a uniform threshold of criteria and documentation necessary to assist in determining eligibility for the apiculture agriculture classification. Guidelines were adopted and endorsed by the Florida State Beekeepers Association, Florida Association of Property Appraisers and Florida Farm Bureau. According to these guidelines, property owners should confirm that our office has on file:
- Current certificate of apiary registration (issued before January 1st)
- Beekeeper’s compliance agreement (if property is zoned non-agriculture)
- Beekeeper’s federal tax return for prior year
- Copies of honey sales receipts (if honey sales)
- Proof of beekeeper’s access to honey extraction equipment (if honey production)
- Copies of queen or bee sale receipts (if bee breeding)
- Copies of all pollination contracts entered into 6 months before and after January 1 (if bee pollination)
- Pollination schedule (if bee pollination)
- Current proof of liability insurance policy
If the landowner is leasing the land to a beekeeper, then a written lease is required. A copy of this lease must be provided to this office. According to these guidelines, the lease should include:
- Property owner and beekeeper’s name
- Parcel identification (number or address)
- Number of leased acres
- Number of hives
- Lease start date and end date. The lease must be in effect on January 1st.
- Compensation and other lease terms
Commercial beekeeping must be the primary use of the property for a significant portion of the year (6 months or more) with a minimum of 24 hives per parcel. A minimum of 24 hives per acre is required for classified acreage.
- Nurseries are recommended to have at least one acre planted. Best Management Practices and densities typical for the industry should be followed.
- Nurseries (both above and in ground) require a Florida state certificate of registration. This certificate can be obtained by contacting the Florida Department of Agriculture and Consumer Services-Division of Plant Industry. It must be obtained by January 1st and submitted with the application.
- Only land that is used for growing plants and necessary service areas shall be classified. Land used for landscape service business is not an agricultural use.
- A bona fide commercial irrigation system must be in place. Irrigation by hose is not typical of commercial operations.
- If plants are mature, an attempt to make a profit must be evident on an annual basis. The marketability of the type and age of in-ground trees will be considered.
- We recommend a minimum number of 5 head to be considered a commercial herd and a minimum of 1 cow per 3 acres on parcels larger than 20 acres.
- Provide receipts for the purchase of livestock with a new application
- The presence of livestock alone is not sufficient evidence that a parcel is in commercial agricultural use. We will consider the terms of the lease, the bona fide commercial nature of the owner and/or the tenant, and the relationship of the business plan to a specific parcel. This data will be compared to typical operations.
- We recommend a minimum number of 12 head to be considered a commercial herd.
- Provide a copy of the Premises ID and all goat/sheep identification numbers as required by Florida State Rule 5C-29. These must be obtained by January 1st and submitted with the application.
- We recommend a minimum of 5 horses boarded to be a commercial stable.
- Provide the number of horses boarded along with a written agreement/lease between the stable and each boarder. Typically, agricultural classification is granted at one acre per boarded horse.
- The presence of horses alone is not sufficient evidence that a parcel is in commercial agricultural use. We will consider the terms of the boarding agreements, the bona fide commercial nature of the owner and/or the tenant, and the relationship of the business plan to a specific parcel. This data will be compared to typical operations.
- A tax return will be requested on a regular basis.
- We recommend a minimum of 3 brood mares. Each mare is expected to foal at least every other year.
- Provide registration documents for each brood mare
- Provide number of studs on the property and registration for each (or insemination reports and stud fee information)
- Provide breeding contracts
- Provide marketing information
- Minimum of 2 cuts per year
- Provide variety of hay harvested
- Provide estimated number of rolls cut per harvest and price per roll
- Free range chickens do not qualify as bona fide commercial agriculture. Chicken coops are generally too small by themselves to measure out for agricultural classification or primary use of the land. Requirements for commercial poultry and egg farms can be found in Florida Administrative Code Chapters 5K-4, 5K-5 and 5K-6 and Florida Statute Chapter 583.
- Other uses such as citrus, row crops, sugarcane, swine, and aquaculture will be reviewed on a case by case basis.
Common Misconceptions About Agricultural Classification and Code Enforcement
I have agricultural classification on my property and I want to build an outbuilding. Do I need to pull a permit?
- Permitting is the jurisdiction of the Martin County Building Department. For more information, please call (772) 288-5916, or visit their website at www.martin.fl.us.
I built a barn on my property and my taxes increased. Why?
- Agricultural classification applies to land only. It does not apply to improvements on the land, including non-residential farm buildings such as barns and stables. The market value of these improvements will be added to the tax roll.
I really need to start building on my property right away. Can you go ahead and approve my application for agricultural classification?
- January 1st of each year is the statutory assessment date. Therefore, the property must be in bona fide commercial agricultural use, or reasonable effort must have been made and continues to be made, on this date. The Property Appraiser cannot pre-approve agricultural use classifications. The granting of all or part of an application for agricultural classification is made only after all relevant information on the parcel has been analyzed by the Property Appraiser.
I need to get my property use code changed to “ag exempt” so I can keep my chickens (or other personal farm pets)
- Agricultural classification is for land used primarily for “bona fide commercial agricultural purposes." Bona fide commercial agricultural purposes means good faith, commercial agricultural use of the land with the intent of earning a profit (personal uses or hobbies do not qualify).
- If your land is being used for commercial agricultural purposes, you are encouraged to apply for agricultural classification.
- Only the acreage that is actually used for the agricultural operation can be classified. The classification does not blanket your entire property.
- Agricultural property use codes are assigned by the Property Appraiser to parcels that have been approved for agricultural classification.
- Zoning and future land use designations are not related to agricultural classification. These designations, as well as subdivision or neighborhood restrictions, determine the legal uses of your property.
While specific, these are only guidelines. The granting of all or part of an application for agricultural classification is made only after all relevant information on the parcel has been analyzed by the Property Appraiser.