Purdue University agricultural economist Larry DeBoer has outlined the major issues involved in the current legislative discussion of farmland taxes.
“It seems likely that something will be done about farmland property taxes,” DeBoer writes in his latest “Capital Comments” column for Purdue Extension. “How it will be done, and who will foot the bill are the big questions.”
Among the possible options the legislature could consider is changing the formula used to calculate farmland assessments to better reflect current market conditions, DeBoer writes. The current formula calculates the taxable value of farmland based on four-to-nine-year-old data, including commodity prices, yields, rents, interest rates and other costs.
But calculating this year’s taxes based on more recent data could increase tax bills in the short term, according to DeBoer, because market conditions have been generally favorable to farmers over the past few years, resulting in higher land values.
Another option could be introducing new deductions for farmland owners, DeBoer writes.
DeBoer’s column appears monthly in the “News Columns” section on the Extension homepage, https://extension.purdue.edu. DeBoer and Tamara Ogle, an Extension educator in Cass County, also have an active Twitter account, @INTaxRockstars, focusing on farmland tax and assessment issues.