Under the TREC Farm and Ranch Contract, the property includes an agricultural exemption for property tax purposes. The buyer plans to continue agricultural use. The agent should advise the buyer that:
Correct Answer
C) The buyer must apply for the agricultural exemption with the county appraisal district after closing
Agricultural exemptions (technically, agricultural use valuations) do not automatically transfer. The buyer must apply with the county appraisal district and maintain the agricultural use requirements to continue the beneficial tax treatment.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
An option contract gives one party the exclusive right, but not the obligation, to purchase or lease a property at a specified price within a specified time period. The buyer pays option consideration to keep the option open.
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