ATTENTION BUYERS OF VACANT FARMLAND:
State Use Value Conversion Charge May Apply to Your Project
Farmland converted to a non-farm use may be subject to a state "use-value conversion charge". The conversion charge applies when the land is actually converted to a residential, commercial, or manufacturing
use and the change is reflected in the tax assessment classification. In addition, land is subject to a conversion
charge if it becomes tax-exempt and its use is no longer agricultural. You can read more about how the charge is calculated HERE.
For example, the buyer of a vacant residential lot that was split off by a farm owner would be subject to the conversion charge after the new home is built and the town assesor changes the classification from ag to residential. Sellers are supposed to disclose that the conversion charge will apply, but sometimes this doesn't happen. As can be imagined, for those unaware of the fee, it can be a rude awakening to get a bill for hundreds or thousands of dollars shortly after finishing construction of a new house.
Note that this fee has been around for many years and is unrelated to the "rezone conversion fee" which the state has repealed.
For more information, contact Majid Allan at 608-267-2536, or firstname.lastname@example.org.