Marcus and Linda are under contract to purchase a 15-acre parcel of forested land in Carroll County, New Hampshire, that is currently enrolled in the Current Use program under RSA 79-A. Their agent informs them that they plan to subdivide and develop the land after purchase. Which of the following disclosures is MOST important for the agent to communicate to Marcus and Linda regarding the Current Use status?
Correct Answer
D) Removing the land from Current Use for development will trigger a land use change tax equal to 10% of the land's full market value.
Under RSA 79-A, when land enrolled in the Current Use program is removed from that status (such as when it is converted to development), a land use change tax is triggered. This tax is equal to 10% of the land's full market value at the time of the change. This is a significant and separate tax obligation that buyers planning to develop must understand before closing, as it can represent a substantial cost.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
A counteroffer is a response to an original offer that changes one or more terms of the offer, effectively rejecting the original offer and creating a new offer. The party who makes the counteroffer becomes the new offeror.
Earnest money is a deposit made by the buyer at the time of the offer or shortly after to demonstrate good faith and serious intent to purchase the property. It is also called a good faith deposit.
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