Another Tree Growth question... (gated, tax, live)

[Fighter 1]

Originally Posted by forest beekeeper

The penalty for taking it out of treegrowth, even simply by not renewing the contract, is roughly equal to the fair market value of the land.

I took one acre out of treegrowth.

After I took it out, I was told that the only reason that I was 'required' to take it out, was due to my house design. Other designs might not have been required to have taken that acre out.

The penalty for that one acre, in my case, was equal to the purchase price of that acre.

Once that one acre was out of treegrowth, that acre was then re-assessed and the current property taxes for that one acre are significantly higher.

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Just wondering what was the differance in taxes ??

[RANGER.101ST]

Originally Posted by Fighter 1

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Just wondering what was the differance in taxes ??

depending on the land value the savings could be substantial but your locked in no way out

[retiredtinbender]

Originally Posted by RANGER.101ST

if you bought the land while it was in tree growth and the contract runs out a whole new contract need to be filld out in your name not the name of the previous owner.there for ot will be a whole new contract not a renewal.

If you buy land in tree growth you have a year to re-establish it in tree growth. Unless the management plan runs out sooner, I believe. You have to get a new management plan every 10 years after that. And you have to follow that plan and it is proprietary so you don't have to show it to a soul including the assessor. How do they know you're following it? Dang good question. But basically you lose some of your land rights for a dollar figure from the state.

[forest beekeeper]

Originally Posted by Maineah

Isn't that kind of the whole idea??

Yes that is the idea.

[7th generation]

Originally Posted by retiredtinbender

How do they know you're following it? Dang good question. But basically you lose some of your land rights for a dollar figure from the state.

Tree growth is a good long term investment. My last plan saved me $500 per year. A forester must renew it every 10 years. With his license on the line, you must be in compliance or he will not sign it.

[forest beekeeper]

Originally Posted by Fighter 1

Just wondering what was the differance in taxes ??

The numbers are different for each county.

Say that you owned 1,000 acres of forest, in 'treegrowth', and that it is assessed at $100 an acre.

1,000 acres of UT land assessed as mixed-species at $100/acre, and in a county with a mil rate of 0.00852, would pay $852.00 property taxes each year.

Without a 'treegrowth' program available, that same land could be assessed at $10,000 an acre, and the annual tax bill could be $85,200

Or depending on recent real estate transactions in the area, each acre could be assessed at $20,000; so your taxes could be $170,400.



A person owning a 1,000 acre tract of land, using it for timber production would never be able to produce $85k worth of timber per year. So it would be chopped up as tract housing the following year. There would no longer be a forest.

The only way to make it possible for land owners to keep their land in forest. Is to keep their land tax assessments low.

When one person buys one acre of land, a wonderful vacation spot, and he pays $40,000 for that acre. The tax assessor sees that and 'adjusts' all other land in the area accordingly. You may have been assessed at $1,000 per acre before. But now he says the market value is $40,000 per acre, so your tax assessment is $40,000 per acre. That one sale, can spike your tax assessment, and spikes your property taxes. When assessed values go up by 40X, so your taxes will go up by 40X.

Without a 'treegrowth' program, there would not be any undeveloped land in Maine.



In my case. I paid $900 per acre to buy this land, and my taxes have been working out to be about $1.05 per acre.

The land that I took out of 'Treegrowth' status is now taxed at $850 per acre.

By taking an acre out of 'treegrowth' the taxes on that acre are now nearly equal to the purchase price of that land. [in the context that $850 is near to $900]

[forest beekeeper]

Originally Posted by 7th generation

Tree growth is a good long term investment. My last plan saved me $500 per year. A forester must renew it every 10 years. With his license on the line, you must be in compliance or he will not sign it.

Each forester is different.

However from among those I have spoken with, they seemed very open to land owner ideas.

If you tell them that you are thinking about Christmas tree production; they will modify your plan. Or simply point you to the page in your Management Plan where it discusses Christmas tree growing.

The forester is your employee.

It is his job, to assess your land, to talk to you, and to form a written plan that includes what you want to do with your land.

There is no requirement for forest to ever be cut down. You could say that you like your forest for it's aesthetics, and you want to keep it 'as is'. Then that is your plan.

[boonelsewhere]

it is not that simple, depending on what is the value of your land at that time. if the land is sitting on prime location have very high assesment then might as well keep the tree growth status.
The penelty could be very expensive.
It is not base on the defered tax as i previously experience from other state, the base amount to calculate is the difference from the current asset value less the asset as tree growth that could substantial.
Than again if the current value of your land is not the much higher than the tree growth, pay now for future freedom may not be a bad idea.

Originally Posted by RANGER.101ST

once your tree growth contract runs out i wouldnt renew it.

[half-pint]

I'm still here reading; please continue.

[BoundtofindME]

Here's a link to the Maine Tree Growth Tax Law

Maine Revenue Services: Property Tax -