Thursday, November 3, 2011
Wouldn't you know I would write a story about buying your first farm and I get a tax notice that day saying "your property has been reappraised and your taxes are going up!"
How can that be after the record housing market value slide the last two years? Well, maybe it is and maybe it isn't.
The statements said our farmstead has gone down in value in the reappraisal, but our land values have went up! Actually they were both very close to the same, within 5% but the big question is CAUV value. The CAUV land value more than doubled since the last appraisal.
My Ohio readers and farm owners and buyers might want to read that link to our Clinton County Auditors statement on CAUV as our taxation on farmland is surely going up, it looks to be over double the last bill we paid if I read this correctly.
How much will this affect our tax bill? I don't know yet. I can call the Auditor's office or attend one of the five informational meetings around the county this month. One landlord warned me of this months ago, so he must have gotten his notice earlier.
Our taxation on this valuation is low compared to other states but even when taxes are "low" and then double, it brings a red flag warning. If you don't pay those taxes and get in arears too far, the land will eventually be sold at sheriff's sale at the courthouse to pay the taxes.
That reminds me of our family's tenant farm that had been past down to the grandson and his cousins, aunts and uncles and he had to file bankruptcy on apartment buildings he owned. To satisfy his debt, the home farm was going to be sold at sheriff's sale, even though he just had partial ownership in it. Our family was able to work with the other heirs and buy it outright before it sold at auction.
It is clear that housing values have went down but agricultural land prices have went up, even sky rocketed in some states. They have not in economically depressed states like Ohio.
Another thing has always been clear, death and taxes. Setting up ownership in a new purchase like a farm and getting your estate in order afterwards to meet your goals after you are gone is very important. Many people miss that and it is evident in this community as one farm family is going through it after the death of the father and the unexpected death of one of the sons.
Tomorrow we need to talk about insurance. "Keep the cards and letters flowing." I do appreciate the comments, emails and phone calls.
This keeps this interesting!