What is Current Use?
Current use is a taxing strategy aimed at making it easier for landowners to keep their open space undeveloped. Instead of being taxed at its real estate market value, land is taxed on its income-producing capability. In other words, land is taxed as a woodlot, or a farm, not as a potential site for houses. Current use keeps property taxes at a lower, more predictable rate.
Purpose: Preserve open space—a property tax strategy helping landowners keep their land undeveloped.
Strategy: Assesses land at its present use rather than its highest potential use. Enacted July 1, 1973.
Basics:
• Parcel must be at least 10 acres or provide $2500 in annual agriculture or horticultural products.
• A one time 10% land use change tax is assessed based on current market value at the time the use changes to a non-qualifying use.
• Can sell or subdivide without penalty. (If parcels are still at least 10 acres or meet other criteria).
• Encumbrance remains with the land, no matter who owns it.
• There are no “buy out” provisions.
Acreage requirements:
• Farm Land: 10 acres or more, unless land is producing $2,500 or more per year in agriculture or horticulture crops—then any size.
• Forest Land: 10 acres or more.
• Unproductive (incapable of producing a farm or forest crop): 10 acres or more.
• Wetlands: Any size (Can include an optional 100-foot buffer around the wetland if unimproved land left in natural state).
• Or any combination of farm, forest, and unproductive land including wetlands: 10 acres or more.
Recreation adjustment:
Current use doesn’t require land to be open to public use. However, if your land is in current use, an additional assessment reduction is available for allowing certain recreational activities.
• An additional 20% reduction in assessment
• No increased liability
• Total ownership doesn’t have to be put into the recreation adjustment.
• Unless a detriment to a crop, must allow hunting, fishing, snowshoeing, hiking, skiing, nature observation.
• Can post against mechanized and off-highway vehicles, camping, etc. and still qualify.
• If taken out of recreation adjustment, land can’t be put back in for 3 years, including the year of disallowance.
Other details:
Frontage: Qualifying land shall not be excluded because of road or water frontage.
Contiguous Parcels: Land qualifies regardless of being divided by a highway, railroad, river or water body, or political boundary.
House Lot: Land and maintained grounds that buildings are on, including driveway, utilities, septic, etc. are excluded from current use. Size of house lot to be excluded isn’t governed by local zoning requirements.
Buildings: Permanent buildings not allowed include sheds, sugarhouse, etc. Footprint of building excluded.
Getting out of current use:
• There is no buy-out provision. Once the land is accepted, it is in forever and the status is passed to subsequent owners.
• Owner must physically change the use of the land to a non-qualifying use, or through sale or other disposal means, create a parcel less than 10 acres.
• Only the changed portion comes out, the rest remains in current use if it is still 10 acres or more or meets other criteria.
Penalty:
The land use change tax due to the town is 10% of the full and true value (non-current use value) of the changed portion as assessed by the town at the time of the change. The rest of the land remains in current use if it still qualifies. The payment of back taxes is NOT the penalty. The town will bill for the penalty.
Penalty is assessed when:
• The land use is physically changed; only the acres changed are assessed. The remainder stays in current use except for roads and utilities to approved developments and land needed to fulfill density requirements for zoning.
• The size no longer conforms (i.e. less than 10 acres. The new owner is responsible for the penalty when land is transferred, not when it is just subdivided).
• Topsoil or gravel is removed and sold. Removal for landowner’s use is allowed for forestry or agriculture.
Note:
• Change from one category to another is allowed, but you must notify your town.
• Land can be sold with no penalty (unless the parcel is less than 10 acres). It remains in current use regardless of who owns it.
• Land can be subdivided with no penalty, unless lots sold or gifted from the subdivision are less than 10 acres. In that case penalties are assessed when land is sold or given. The new owner is responsible for the penalty.