[zimm17]

We're looking at properties and I want to either build a shop for my small business or hopefully the property comes with one. If I build, it will likely be approx 30x40 feet with a couple of garage doors. How are they taxed?

I saw on the taxation website if I claim a business out of a garage, it gets taxed at a non-homestead rate. Is that higher or lower than a residential building? I'm trying to gauge if there's any reason to keep the building small rather adding more square feIe. I'll keep the footprint smaller if I'll get my socks taxed off on square footage.

[atypicalLIer]

Originally Posted by zimm17

We're looking at properties and I want to either build a shop for my small business or hopefully the property comes with one. If I build, it will likely be approx 30x40 feet with a couple of garage doors. How are they taxed?

I saw on the taxation website if I claim a business out of a garage, it gets taxed at a non-homestead rate. Is that higher or lower than a residential building? I'm trying to gauge if there's any reason to keep the building small rather adding more square feIe. I'll keep the footprint smaller if I'll get my socks taxed off on square footage.

I cant help with the tax question, but want to warn you about zoning. I realize not all areas have zoning with respect to out buildings housing a home business, but my Windsor County community is currently creating zoning which might hamper businesses.

[Riley.]

Originally Posted by atypicalLIer

I cant help with the tax question, but want to warn you about zoning. I realize not all areas have zoning with respect to out buildings housing a home business, but my Windsor County community is currently creating zoning which might hamper businesses.

Have you seen that giant 'finger' at a property in Westford? I think the town denied him a building permit for some type of business he wanted to put on his property so he paid $5K for a guy to carve a giant middle finger and erected it on a pole about 30-40 feet in the air at the edge of his property, near the road. Can't miss it.

[harry chickpea]

Originally Posted by Riley.

Have you seen that giant 'finger' at a property in Westford? I think the town denied him a building permit for some type of business he wanted to put on his property so he paid $5K for a guy to carve a giant middle finger and erected it on a pole about 30-40 feet in the air at the edge of his property, near the road. Can't miss it.

Oh yeah! You could hear me laugh all the way from Alabama.

If you build a garage that has no visitors, and just HAPPEN to decide to use it for making something, that is a whole lot different than sayin' "I'm building a commercial structure on my residential land. What could go wrong?"

An uncle's long unused garage business came up for sale recently. Lord help the person who bought it, as they probably will have to simultaneously preserve the historical structure and excavate twenty feet down and a hundred feet in circumference to meet the environmental requirements.

The simple answer is to NOT dare to create a business in Vermont. It wants to be Norman Rockwell's wet dream for generations to come.

BTW, my friend, how did your cell service work out?

[jackmccullough]

Your post raises a few questions that I'll try to answer, although I don't know the answer to everything.

1. Some places in Vermont have zoning, some do not. Before you buy anything you should contact your local authorities to determine if there is zoning and if your proposed use is permitted where you want to buy. It's much easier to get a permit if it's a permitted use than if you have to get a variance.

2. The assessment of your property is based on fair market value, so the value of any improvements will contribute to that.

3. Here's a link to an FAQ page for the Vermont Department of Taxes: https://tax.vermont.gov/tax-professi...property-taxes. I've never owned commercial property in Vermont, but I know that every year I have to file a declaration of what percentage of my property is residential (in our case, 100%) and what is commercial.

4. There's plenty of hyperbole in this thread. In lots of places you can basically do whatever you want, and there are very few places where historical preservation is a factor in what you're allowed to do. Of course, anybody with any sense will find out what is allowed before buying, much less building.

Good luck!

[GeoffD]

Originally Posted by zimm17

We're looking at properties and I want to either build a shop for my small business or hopefully the property comes with one. If I build, it will likely be approx 30x40 feet with a couple of garage doors. How are they taxed?

I saw on the taxation website if I claim a business out of a garage, it gets taxed at a non-homestead rate. Is that higher or lower than a residential building? I'm trying to gauge if there's any reason to keep the building small rather adding more square feIe. I'll keep the footprint smaller if I'll get my socks taxed off on square footage.

The “is it higher or lower than the residential rate” depends on the town. The commercial rate is fixed state-wide. The residential rate varies depending on whether the town spends “too much” on schools and gets “fined” by the state. It also depends on how close to 100% valuation the town assesses residential property. The state assigns a CLA to each town. CLA stands for Common Level of Assessment. If the state thinks the town assesses at 80% of value, the rate gets bumped 20%. So you can live in a town that tuitions out students to an expensive school district. That bumps your residential rate even though you have no control over it.

The residential state school property tax is means tested. The commercial one isn’t. Depending on your income, you might pay a lot less property tax on a garage classified as residential. If you’re high income, you probably want to take the business tax deductions and depreciation. I don’t think there is one universal answer.

[arctichomesteader]

If you live in a town with no zoning, keep it hidden from view. Listers have no right to access private property. I live on a private road and don't allow them access. No reason to make it easy for the state to tax your home higher.

[Riley.]

Originally Posted by arctichomesteader

If you live in a town with no zoning, keep it hidden from view. Listers have no right to access private property. I live on a private road and don't allow them access. No reason to make it easy for the state to tax your home higher.

Not sure I agree with this since I've had several discussions with our Select Board, the people who did our recent re-assessment for the grand list, and others in town on this topic (and my husband used to say he wasn't going to let anyone in unless they had a warrant )

Couple of random obs:

If you don't allow access to your property, the assessors can 'estimate' the value of the home based on current figures, comps, whatever tools they use. If you were to disagree with that assessment, then you HAVE to let them in to resolve the dispute.

In my town, most homes have some property around it, so the assessors can walk around for a look see. You don't have to allow them in your home, though, this is true.

A reassessment doesn't necessarily mean that your taxes will increase. (emphasis on not necessarily). If everyone's home is reassessed - as our town is going through now - because they are 10 years late! - your taxes may actually be reduced (unlikely?) because undervalued homes will now be properly valued. This is for the Grand List, which, full disclosure, I'm still not sure I understand.

We let them in this year but will not know until the town wide reassessment is completed next year how much the value of our home has increased. We don't have an expensive, fancy home. It's pretty basic. But we have done some cosmetic upgrades inside, replacing cabinetry, etc, which to our understanding may not have that much of an affect because it would not be classified as a 'remodel.' I guess we'll see.

[RMESMH]

Originally Posted by arctichomesteader

If you live in a town with no zoning, keep it hidden from view. Listers have no right to access private property. I live on a private road and don't allow them access. No reason to make it easy for the state to tax your home higher.

I know Maine isn't Vermont , but I got into a conversation about 15 years ago with a business owner in Bangor (who had owned the business at that location for about 50 years), and he told me that either the city or the county (I think it was the county) had hired people to go out in helicopters to catch people in rural areas who had built non permitted (sometimes with the intent to hide them from view) structures that they hoped 'the taxman' would never notice.

[harry chickpea]

Originally Posted by RMESMH

I know Maine isn't Vermont , but I got into a conversation about 15 years ago with a business owner in Bangor (who had owned the business at that location for about 50 years), and he told me that either the city or the county (I think it was the county) had hired people to go out in helicopters to catch people in rural areas who had built non permitted (sometimes with the intent to hide them from view) structures that they hoped 'the taxman' would never notice.

Exactly. No need to even hire helicopters now, what with all sorts of commercial satellite images available. The idea of hiding structures by fences or private property signs was misguided long before that. The USGS topological maps were updated by use of aerial areal flyovers in the 1940s and 1950s. I have prints of some of those images taken over Vermont that are clear enough to show outhouses.