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Archive for March 2017

Valuing the Family Farm for Property Tax Purposes – Part I

Grouping of family farms and property tax considerations

An owner may apply for his or her farm to be valued based on its current use as opposed to its true and fair value. Property tax is assessed on the value of real estate as determined by the county assessor.Generally, Washington real property values are determined based on the “true and fair value” which includes criteria such as sales of similar property within the last five years and potential income uses. The Open Space Taxation Act created three property classifications which allow property to be taxed based on current use value: open space, farm and agricultural land, and timberland. Farm values will be derived from the farm’s earning capacity. This means a farm may be valued as a farm rather than the subdivision it could be.

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