Nebraska Land Values and Property Taxes

Nebraska Land Values

 

Amid the many challenges that face farmers and landowners across Nebraska, a continued concern is high property taxes. With the plummeting grain prices over the last 3 years, and with the skyrocketing property tax rates of the last 10 years—which have increased 176 percent—it’s no wonder landowners and producers are hoping for property tax relief at the legislative level.

Toward the end of this year’s 2016 legislative session, lawmakers were able to advance LB 958 and LB 959, which provides additional money to the state’s property tax credit program, valuing ag land at 90 percent versus 75 percent of market value for the credit program, tightens limits on budget growth and levy increases for all local governments, and slows the rise in government-assessed cropland values across the state—measures that proponent and Governor Pete Ricketts calls “tools to help local governing entities control spending.”

In a state where 51 percent of total school spending comes from property taxes, in comparison to the national average of 32 percent—this is welcome news to landowners.

In calculating real estate taxes, all land is taxed based on either market value or fair use value. Often farmland appraisals are based on a formula for Current Agricultural Use Value (CAUV), or the income a farmer can expect to earn based on factors including grain prices, farm rental rates, soil type and productivity, production expenses, and interest rates, among other variables.

As such, the record high crop prices in 2012 and the all time high farm incomes of 2013 are now factoring in to property tax appraisals. Given the plummeting farm incomes since then, combined with low interest rates, which also push taxes up for landowners, there is a perfect storm brewing for potential tax problems, despite the property tax relief legislation.

With this much money on the line, it’s little surprise that owners of Nebraska farmland often turn to professional land managers to provide them with highly accurate appraisal services. UFARM’s own agricultural valuation professionals have years of combined experience in local land markets with which to provide their clients with a clear account of their property’s value and potential.

Using the latest appraisal technology, UFARM appraisers are experienced in completing all the necessary reports for estate valuation, loan collateral, sales analysis, and property partition.

In addition, UFARM has certified rural appraisers on staff, offering appraisals through each of our offices across the state. These services include documented market value estimates that are carefully researched, written to withstand challenge, and provide a precise picture of a landowner’s property value.

In addition to property tax purposes and property tax appeals, an accurate value appraisal is important for a number of other, equally significant reasons, including:

-buying, selling, exchanging, or dividing real estate

-estate planning and gifting

-loan evaluations

-litigation

-condemnation proceedings

-eminent domain for roadways, pipelines, or electrical lines

When it comes to determining the value of your land, count on the most experienced appraisers. Feel free to contact UFARM for all of your appraisal needs.