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Rule Title: CRITERIA FOR AGRICULTURAL LAND VALUATION FOR LAND TOTALING LESS THAN 160 ACRES
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Department: REVENUE
Chapter: REAL PROPERTY
Subchapter: Agricultural Land
 
Latest version of the adopted rule presented in Administrative Rules of Montana (ARM):

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42.20.620    CRITERIA FOR AGRICULTURAL LAND VALUATION FOR LAND TOTALING LESS THAN 160 ACRES

(1) Multiple parcels, consisting of less than 160 acres, both contiguous and noncontiguous, in the same ownership, actively devoted to agricultural use and part of a bona fide agricultural operation must meet all of the production and income qualification tests in these rules for classification as agricultural land.

(2) Noncontiguous parcels in the same ownership and actively devoted to agricultural use can combine agricultural production and/or livestock carrying capacity to meet eligibility requirements. Each noncontiguous parcel of land, less than 160 acres in size and not a part of a larger agricultural operation, must individually meet the agricultural eligibility criteria set forth in this rule.

(3) An applicant for agricultural land classification must prove that the land indicated in the application actually produced agricultural crops as defined in 15-1-101, MCA.

(4) A personal property reporting form that lists the farm and ranch personal property and livestock on the land must be completed by the current landowner and be on file at the local department office.

(5) If agricultural products, other than livestock, are marketed from the land identified in the application, the applicant must provide proof that the parcel(s) indicated in the application produced at least $1,500 gross agricultural income each year.

(6) Income must be from agricultural products marketed by, or received by the owner, the owner's family members, or the owner's agent, employee, or lessee. Acceptable proof of income must include:

(a) sales receipts;

(b) cancelled checks;

(c) copies of income tax statements;

(d) other written evidence of sales transactions;

(e) annual rental or lease payments of at least $1,500, provided there is demonstrated proof of agricultural activity on the land and the land is capable of sustaining that activity; or

(f) annual rental payments of at least $1,500, made under the federal conservation reserve program (CRP), or a similar program that reimburses the landowner for removing the land from the current agricultural use and placing it in a different agricultural use.

(7) For parcels of land under 20 acres, (6)(e) and (f) are not considered eligible agricultural income for this rule.

(8) The sale of biological control insects shall be considered agricultural income if the insects are supported solely from noxious weeds grown on the land indicated on the application.

(9) For grazing land, the land must be capable of sustaining a minimum carrying capacity expressed in animal unit months. The minimum animal unit months must equate to $1,500 in annual gross income as determined by the Montana State University-Bozeman's Department of Agricultural Economics and Economics, with cattle as the base.

(a) For the reappraisal cycle ending December 31, 2020, the Montana State University-Bozeman's Department of Agricultural Economics and Economics determined the minimum number of animal unit months of carrying capacity to be 31 animal unit months.

(b) The department will use the NRCS soil survey information to calculate the carrying capacity for nonirrigated native grazing land.

(c) For nonirrigated domestic grazing land, the department shall increase the estimated nonirrigated native grazing land carrying capacity by 50 percent.

(10) For land other than grazing land that is used primarily to raise crops for consumption by humans, livestock, poultry, or other animals in the agricultural operation rather than for market, the applicant must prove that the land on the application produced the annual equivalent of $1,500 in gross agricultural income from these crops. Proof of income must include:

(a) a written estimate of the weight or quantity of food or other eligible agricultural product produced. The weight provided must be multiplied by the current commodity price to determine that the minimum annual gross income of $1,500 was met; and

(b) if the consumption was from livestock, or the livestock was consumed by humans, the land must be capable of sustaining the minimum number of animal unit months of carrying capacity described in (9), with cattle as the base.

(11) Summer fallow farmland must produce a minimum of $1,500 in agricultural crop income in the year it is farmed to be valued as agricultural land.

(12) A parcel or parcels of land less than 20 acres that meet all of the following criteria will remain classified and valued as agricultural land or as nonqualified agricultural land as defined in 15-6-133 and 15-7-202, MCA. The criteria that must be met are:

(a) the parcels are contiguous or noncontiguous parcels of land under one ownership;

(b) the parcel or parcels previous to a reduction in acreage as defined in (c) totaled 20 acres or more in size and qualified as agricultural land or as nonqualified agricultural land under 15-6-133 and 15-7-202, MCA;

(c) a portion of the parcel or parcels was taken by or given without compensation, or sold for a public use as described in 70-30-102, MCA, to the federal government, the state, a county, or a municipality, and that action reduced the number of acres in the parcel or parcels to less than 20 acres; and

(d) since the reduction in acreage occurred, the parcel or parcels have not been further divided or devoted to a residential, commercial, or industrial use, and there are no covenants or other restrictions that when enforced effectively prohibit agricultural use.

(13) A parcel or parcels of land that meet the criteria in (12)(a) through (d) are eligible for the classification determination identified in (12) regardless of when the acreage reduction occurred. However, taxpayers must notify the department of their eligibility in writing by submitting a Request for Informal Classification and Appraisal Review, Form AB-26, within 30 days from the date on the classification and appraisal notice for eligibility to begin in the first year of the two-year valuation cycle, or by June 1 in the second year of the valuation cycle for eligibility to begin in the second year.

(14) No refunds of taxes resulting from a reclassification of parcels under this part will be allowed for any tax year prior to the tax year in which the taxpayer notifies the department of their eligibility in (13).

(15) For contiguous and noncontiguous parcels of land under one ownership as defined in ARM 42.20.601 totaling less than 20 acres in size, any acreage in excess of that stated in the forest land classification in ARM 42.20.705 is classified as agricultural provided the acreage is actively devoted to qualifying agricultural use.

 

History: 15-1-201, MCA; IMP, 15-7-102, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06; AMD, 2008 MAR p. 1822, Eff. 8/29/08; AMD, 2010 MAR p. 549, Eff. 2/26/10; AMD, 2014 MAR p. 2994, Eff. 12/12/14; AMD, 2015 MAR p. 2350, Eff. 1/1/16; AMD, 2017 MAR p. 2198, Eff. 11/25/17.


 

 
MAR Notices Effective From Effective To History Notes
42-2-977 11/25/2017 Current History: 15-1-201, MCA; IMP, 15-7-102, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06; AMD, 2008 MAR p. 1822, Eff. 8/29/08; AMD, 2010 MAR p. 549, Eff. 2/26/10; AMD, 2014 MAR p. 2994, Eff. 12/12/14; AMD, 2015 MAR p. 2350, Eff. 1/1/16; AMD, 2017 MAR p. 2198, Eff. 11/25/17.
42-2-942 1/1/2016 11/25/2017 History: 15-1-201, MCA; IMP, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06; AMD, 2008 MAR p. 1822, Eff. 8/29/08; AMD, 2010 MAR p. 549, Eff. 2/26/10; AMD, 2014 MAR p. 2994, Eff. 12/12/14; AMD, 2015 MAR p. 2350, Eff. 1/1/16.
42-2-924 12/12/2014 1/1/2016 History: 15-1-201, MCA; IMP, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06; AMD, 2008 MAR p. 1822, Eff. 8/29/08; AMD, 2010 MAR p. 549, Eff. 2/26/10; AMD, 2014 MAR p. 2994, Eff. 12/12/14.
42-2-815 2/26/2010 12/12/2014 History: 15-1-201, MCA; IMP, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06; AMD, 2008 MAR p. 1822, Eff. 8/29/08; AMD, 2010 MAR p. 549, Eff. 2/26/10.
42-2-794 8/29/2008 2/26/2010 History: 15-1-201, MCA; IMP, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06; AMD, 2008 MAR p. 1822, Eff. 8/29/08.
12/22/2006 8/29/2008 History: 15-1-201, MCA; IMP, 15-7-201, 15-7-202, 15-7-203, 15-7-206, 15-7-207, 15-7-208, 15-7-209, 15-7-210, 15-7-212, MCA; NEW, 1985 MAR p. 2025, Eff. 1/1/86; AMD, 1991 MAR p. 2042, Eff. 11/1/91; AMD, 1993 MAR p. 3048, Eff. 12/24/93; AMD, 1996 MAR p. 1172, Eff. 4/26/96; AMD, 1997 MAR p. 1827, Eff. 10/7/97; AMD and TRANS, from ARM 42.20.147, 2003 MAR p. 1888, Eff. 8/29/03; AMD, 2004 MAR p. 2106, Eff. 9/3/04; AMD, 2004 MAR p. 3160, Eff. 12/17/04; AMD, 2006 MAR p. 3103, Eff. 12/22/06.
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