Margaret owns a 50-acre forested parcel in a rural New Hampshire town. The parcel is enrolled in the Current Use Taxation Program under RSA Chapter 79-A. She is considering selling the land to a developer who plans to subdivide it. Which of the following best describes the tax consequence when the land is removed from Current Use?
Correct Answer
B) A land use change tax equal to 10% of the full assessed market value of the land is triggered upon removal from Current Use.
Under RSA 79-A:7, when land enrolled in New Hampshire's Current Use Taxation Program is removed from Current Use — for example, when sold for development — a land use change tax is assessed at 10% of the full market value of the land at the time of the change. This tax is separate from and in addition to the standard Real Estate Transfer Tax. It is designed to recapture some of the tax benefit the owner received while the land was assessed at its lower current use value.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Reconciliation is the final step in the appraisal process where the appraiser analyzes the value indications from all applicable approaches and arrives at a single final opinion of value. It is not a simple average of the three values.
The comparable sales approach estimates a property's value by comparing it to similar properties that have recently sold in the same market area. It is the most widely used and reliable approach for appraising residential properties.
The cost approach estimates a property's value by calculating the current cost to rebuild the improvements, subtracting accumulated depreciation, and adding the land value. It is most reliable for new construction and special-purpose properties.
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- → The income approach to appraisal is most commonly used for which type of property?
- → Which formula correctly calculates the capitalization rate?
- → External obsolescence in Oklahoma:
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