Farmland Tax Assessment

New Jersey Farmland Tax Assessment

In 1963, a constitutional amendment was passed by the NJ Legislature, allowing a property tax valuation based on agricultural or horticultural use. The following year, the Farmland Assessment Act was passed. Widely publicized as an effective and low-cost solution to conserving open space in New Jersey, the Farmland Assessment Act blended the desperate need for property tax equity by farmers with the conservation and scenic concerns of the urban population.

As property tax increased in the late 1970’s and early 1980’s, many forest land owners began to apply for Farmland Assessment. This trend was first reported by the Division of Taxation in 1976, when 47,825 acres of non-appurtenant woodlands were recorded, compared to 297,687 acres of total woodlands. Landowners used the justification that trees were “plants . . . useful to man.” Many within the NJ Forest Service and the forestry and conservation community were concerned that the Farmland Assessment Act, as it then existed, could favor excessive and unnecessary cutting of trees, and would undermine foresters’ authority to justify judicious and necessary harvests.

Therefore, in 1986, the Farmland Assessment Act was modified to standardize forest planning and establish criteria for practicing foresters.

Basic Requirements:
1. Applicant must own the land.
2. Owner must annually apply for Farmland Assessment on Form FA-1 with the municipal tax assessor on or before August 1 of the year immediately preceding the tax year.
3. Land must be devoted to agricultural and/or horticultural uses for at least two years prior to the tax year.
4. Land must consists of at least 5 contiguous (adjoining) acres being farmed and/or under a woodlot management plan. Land under and adjoining the farmhouse is not counted in the 5-acre minimum area needed to qualify.
5. Gross sales of products from the land must average at least $500 per year for the first 5 acre of woodland or $1,000 if property has 5 acre of more of cropland, plus an average of $5 per acre for each acre over 5, except in the case of woodland or wetland where the income requirement is $.50 per acre for any acreage over 5; or there is clear evidence of anticipated yearly gross sales, payments, or fees within a reasonable period of time dependent on the agricultural or horticultural products being produced.
6. Owner must represent that the land will continue in agriculture or horticultural use to the end of the tax year.

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