The information below is to assist you in determining if you are eligible for agricultural classification. In order to qualify for agricultural classification you must meet the following requirements:
The owner of a leased property must provide a non-use statement to verify property does not carry personally-owned livestock
Contiguous parcels must have same deeded ownership
Primary use of the land must be agricultural. Ownership alone does not qualify property for agricultural classification
Property must have been in active production for three of the last five years
There must be a reasonable expectation of operating profit from the agricultural use of the property
The test of reasonable expectation of operating profit is whether a prudent rancher or farmer is managing or operating his unit similar to other experienced and successful ranchers or farmers and reasonably expects to make a profit in a reasonable period of time
If the property is non-contiguous, the non-contiguous parcel must be managed and operated on a unitary basis and each parcel must make a functional contribution to the agricultural use of the property. In general, non-contiguous parcels must be fenced, have an independent water source and have ingress and egress.
The following DO NOT qualify for agricultural classification:
Leased parcels under 20 acres, unless the parcel makes a functional contribution to the agricultural use of the main operation
Leased subdivided lots
Producer/rancher-owned non-contiguous parcels under 5 acres (unless the parcel contains a water supply for animals)
Additional requirements to gain agricultural classification for grazing:
Grazing land with a minimum Carrying Capacity of forty animal units and containing an economically feasible number of Animal Units (Carrying Capacity is the number of animal units supported by a section of land (640 acres) for one year. Animal Unit means one six-month-old beef, one cow with calf, one bull or five sheep or goats).
Animals are identifiable by brands, tags or tattoos
Animals are confined to the property and water is available
Required documentation for agricultural classification for grazing
Five years of business records containing Profit and Loss statement for the property.
Leases must report the fair market rate per animal unit
If lease includes “other considerations”, they must be defined and the fair monetary value of those considerations must be reported
Receipts for services rendered and items purchased relevant to the agricultural operation
Brand inspection certificates
Sales invoices of agricultural products or livestock sold