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Real Estate Assessments - Land Use

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1. What is the Land Use Assessment Program?

The Land Use Assessment Program provides a deferral of real estate taxes when a property meets qualifying standards for agricultural, forestry, horticultural or open space uses.

2. What is the purpose of the Land Use Assessment Program?

The purpose of the Land Use Assessment Program is to encourage the preservation and proper use of such real estate, conserve natural resources, promote proper land-use planning, and promote a balanced economy.

3. How do I enroll in the Land Use Assessment Program?

Under the county’s Land Use Assessment ordinance, an application must be submitted to the Office of the Commissioner of the Revenue. Original applications must be received at least 60 days prior to the tax year for which such special assessment is sought (November 1). A separate application is required for each parcel. All real estate taxes must be current before an application will be accepted. Those wishing for a parcel to qualify under the Open Space classification must have an Open Space Agreement.

4. Who determines the Standard of Classification for the Land Use Assessment Program?

The State Land Evaluation Advisory Council (SLEAC) publishes the Standards for Classification as required by the Code of Virginia Section 58.1-3236. These standards set forth the general and specific requirements to qualify a property for Land Use Assessment.

5. Why did my land use assessment value increase for 2020?

Loudoun adopts use value estimates developed by the State Land Evaluation Advisory Council (SLEAC) for use in administering Loudoun County’s Land Use Assessment Program. For tax year 2020, SLEAC estimates the value of land used for Agricultural and Horticultural purposes in the county has increased approximately 40 percent over the previous tax year. 

6. What are the different Land Use classifications can I apply for?

The Land Use Assessment Program has four classifications: agricultural, forestry, horticultural or open space uses.

7. What are the requirements for Agricultural use?

To qualify, the property must be at least 5 qualifying acres, and devoted to the bona fide production for commercial sale of plants or animals, or plant or animal products useful to man. Generally accepted products include livestock, dairy, poultry, and aquaculture. Field crops shall be primarily for commercial uses and a minimum gross income of $1,000 per year must be documented or minimum of $1,000 averaged over the previous three year period.

8. What are the requirements for Forestry use?

To qualify, the property must be a minimum of 20 qualifying acres and must meet the standards for productive or nonproductive forestland.

9. What are the requirements for Horticultural use?

To qualify, the property must be at least 5 qualifying acres, and devoted to the bona fide production for commercial sale of fruits, vegetables, ornamental plants and ornamental products. Horticultural crops shall be primarily for commercial uses and a minimum gross income of $1,000 per year must be documented or minimum of $1,000 averaged over the previous three year period.

10. What are the requirements for Open Space use?

To qualify for open space, the use must be consistent with the land use plan of the county. In general, the real estate must be subject to a perpetual conservation, historic or open space agreement held by a public body; be part of an agricultural or forestry district approved by the local government; or meet the requirements for a recorded open space commitment with the governing body.

11. What are the requirements for Historic Resource Protection?

The property must be 5 qualifying acres, be listed as an historic property on the National Register of Historic places; and be subject to a perpetual scenic, historic or open space easement or a 7-to-10-year recorded commitment with the county.

12. What are the requirements for Scenic Resource Protection?

The property must be 5 qualifying acres: be contiguous to a scenic byway with at least 300 feet of frontage or a scenic river; or be adjacent to a public property listed in the approved State Comprehensive Outdoors Recreation Plan (also known as the Virginia Outdoors Plan) and be subject to a perpetual open space easement or a 7-to-10-year recorded open space commitment with the County.

13. What are the requirements for Protection of Farmland for Future Agricultural Use?

The property must have at least 20 qualifying acres and be located in a rural area as defined by the county’s General Plan. The property must also be subject to a minimum 10-year open space commitment with the county.

14. What are the requirements for Achievement of Comprehensive Planning and Community Development Goals?

In 2010, the Board of Supervisors approved a moratorium to not accept new open space applications for parcels with less than 20 acres. In January 2014, the Board approved the continuation of the moratorium. Therefore, the parcel must be at least 20 qualifying acres, be protected by a permanent open space easement, scenic easement or be located in an agricultural or forestry district. Rural village and rural hamlet conservancy lots protected by permanent open space easements may qualify when they meet minimum qualifying acreage.

15. What is a Permanent/Perpetual Open Space Easement (POSE)?

A permanent or perpetual open space easement protects the land in perpetuity and transfer with the land upon sale. The property must have a minimum of 5 acres. Please note a property that is subject to a recorded perpetual conservation, historic or open space easement must be held by a public body.

16. Does the acreage under my house qualify for the Land Use Assessment Program?

Land excluded from Land Use Assessment and assessed at fair market value includes the area under houses, yards, personal gardens, driveways/roadways to houses, unused fields and any structure not related to the qualifying use. Land under tenant houses, occupied as part of compensation by full time employees in the farming operation should not be included in this declaration.
It is the property owner(s) responsibility to report any change to a non-qualifying use of a property, including ineligible land, to the local assessing official within 60 days of such change. This change will result in roll back taxes being assessed on the portion of the land that is declared as ineligible.

17. What is the renewal process?

Loudoun County Ordinances require the renewal of each parcel enrolled in the Land Use Assessment Program every sixth year with payment of the appropriate fee and submission of supporting documentation to validate the Land Use Assessment Program use and production. While the county attempts to mail renewal forms to every property owner of record enrolled in the program, it is ultimately the responsibility of the property owner to ensure the appropriate renewal of any property in the program. Please Note: Applications and Renewals will not be accepted after December 5 for the following tax year.

18. When is the renewal period and what are the fees associated with the renewal period?

Renewal forms are mailed the first week of September and are due, without penalty, by November 1. The filing fee is $125.00 per parcel plus an additional $1.00 per acre. Renewal forms are accepted from the regular deadline November 2 through December 5 with a $300.00 late fee per parcel in addition to normal filing fees noted above. *If November 1 or December 5 falls on a weekend or holiday, the deadline will be extended to the next business day.

19. What documentation is required to validate the use and production?

Examples of acceptable documentation for production qualifying are: 1.Profit or Loss from Farming Form (1040F) 2.Farm Rental Income/Loss Form (4835) 3.Supplemental Income/Loss Form (1040E) 4.Business Profit and Loss Form (1040C) 5.Farm Sale Receipts 6.Bartering agreements The property owner is responsible for providing documentation on the use of the property at the time of renewal. Incomplete applications/renewals will not be accepted and could result in the property being removed from land use assessment and roll back taxes being assessed. *If a landowner does not have any of the above documentation, please contact the Commissioner of the Revenue’s Office and speak with one of the Tax Exemptions and Deferral Specialists.

20. What are roll-back taxes?

Roll-back taxes are assessed based on the difference between the land use assessment and fair market value for the 5 years prior to a change (with some exceptions) plus interest at a rate of five-sixths (5/6) of one percent per month. The current year taxes will be based on fair market value. Changing to a non-qualifying use, rezoning to a more intensive use and the split off or subdivision of lots may trigger roll-back taxes. (See the Code of Virginia Section 58.1-3237)

21. What are the exceptions to the current plus five year roll-back taxes?

Owners of parcels with a recorded Open Space or Sliding Scale Agreement are liable for roll-back taxes equivalent to the term of the recorded respective Open Space or Sliding Scale Agreement.

22. What is a Sliding Scale Agreement?

Any property that is already qualified for land use assessment may qualify for an additional deferral of taxes upon an approved written commitment to keep the property in a qualifying use for an additional number of years.

• For commitment to hold a property in its qualifying use for more than 10 years but not more than 20 years - 99% of the taxes otherwise assessed may be deferred for the term of the commitment.

• For commitment to hold a property in its qualifying use for more than 5 years but not more than 10 years - 50% of the taxes otherwise assessed may be deferred for the term of the commitment.

To qualify for the additional deferral, the property owner must execute a written agreement on a form approved by the County Attorney, executed by the County Administrator or his/her designee and recorded in the County Clerk’s land record office. The property owner is responsible for recording fees and timely recording of the agreement. The additional deferral does not apply to buildings and ineligible land which is assessed at fair market value.

23. May I sell my property which is enrolled in the Land Use Assessment Program, and is the owner responsible for roll-back taxes?

Yes, you may sell property enrolled in the program. If the new owners will be continuing the approved classification then the seller should provide the necessary proof of production for the years since the last renewal. That documentation can be provided to the purchaser or the Exemptions & Deferrals Division of the Office of the Commissioner of the Revenue. If the new owners will NOT be continuing the approved classification the change must be reported to the Exemptions & Deferrals Division within sixty days following the change and a request an estimate of roll-back taxes should be completed. The liability for the roll-back taxes is based on when the change to a non-qualifying use is effective.

24. Are you allowed to subdivide a parcel in the Land Use Assessment Program?

Loudoun County Ordinance requires roll-back taxes to be assessed on lots split from a previously approved property that do not meet the minimum acreage and use requirements for the qualifying purpose or use as set forth in the Code of Virginia. A new application may be filed with the Commissioner of the Revenue for any such lot that meets the minimum acreage and use requirements for the qualifying purpose or use as set forth in the Code of Virginia.

25. What is “Timing Out”/”Work Out Plan”?

Timing Out is an option in which a parcel was enrolled in the Land Use Assessment Program, is now not enrolled, but still continuing in its qualifying use. The parcel timing out will pay taxes based on the fair market assessed value for a period of 5 years. At the conclusion of those 5 years, the parcel will face no roll-back taxes. Please be advised that a potential roll-back tax liability exists for a period of 5 years from the date the property was unenrolled in the program. It is imperative that you understand that a failure to continue a qualifying use will result in the assessment of roll-back taxes on the property.

26. Can a parcel in the Land Use Assessment Program be removed for failure by the owner to pay taxes?

If on June 1 of any year taxes for a prior year on any parcel of real property enrolled in the Land Use Assessment Program are delinquent on real property taxes, the Treasurer shall notify the Commissioner of the Revenue who shall remove such parcel from the Land Use Assessment Program.

27. What is an Agricultural and Forestal District (AFD)?

Any interested landowner can obtain an application for the creation of or addition to an Agricultural or Forestal District from the Loudoun County Department of Planning and Zoning at 703-777-0246.

28. Can I appeal my Use Value if I am enrolled in the Land Use Assessment Program?

Yes, you may file an appeal for your Use Value assessment with the Board of Equalization (BOE) by June 1 for the current tax year. Members of the BOE are appointed by the Board of Supervisors and are independent from the Commissioner of the Revenue. You may contact the Board’s Administrative Assistant at 703-777-0289. The State Land Evaluation Advisory Council (SLEAC) annually adopts use rates taking into account the estimated income production of several soil types suitable for agricultural, horticultural or forest uses. These rates are then provided to tax assessment offices for their use in administering Land Use Assessment Programs.