Loophole may close on ‘pretend’ farmers

Only farmers and ranchers who live on property they are using for bona fide agricultural purposes would have the land their homes sit on get a property tax break under a bill that’s working its way through the Colorado Legislature.

The measure, introduced by Rep. Tom Massey, R-Poncha Springs, is designed to close a loophole in a state law that allows owners of residential property on agricultural land to get a cheaper property tax rate even if they aren’t really farming or ranching.

The problem with the law is it doesn’t specify how much of the land must be used for agricultural purposes or for how long in a tax year it is used, Massey said.

As a result, some property owners are pretending to be farmers or ranchers and getting away with not having to pay thousands of dollars in taxes, he said.

“Anything that’s legitimately ag is clearly protected, and that was our intent from day one,” Massey said.

“To a large degree, the assessors already know what’s really appropriate. They know the loophole properties from what’s legitimate.”

Under his bill, which is to be debated by the full House later this month, owners of residential property on agricultural land must show county assessors that their homes are integral to the agricultural operations around them.

The bill is the result of a legislative task force that found examples of property owners using and in some cases abusing the law.

The examples included multimillion-dollar homes on large tracts of land that allow grazing for as little as one day a year.

Current law already requires the home itself to be assessed on the higher residential rate.

But under Massey’s bill, up to two acres of land the home sits on, including any outbuildings such as garages, would be assessed at that same residential rate unless they can show the owner also works the agricultural operation there.


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