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*NEW* Urban Agricultural Property Tax Credit 

On March 7, 2017 the Montgomery County Council passed Bill 31-16, which will provide a tax credit for urban agricultural properties.

This tax credit is for urban agricultural properties that are zoned residential, are between ½ acre and 3 acres and which are used solely for urban agricultural purposes—the owner may live in a house on the property. The tax credit is limited to those properties for which the property owner has more than $5,000 in gross income from the sale of products grown or raised on the urban agricultural property.  To be eligible for the credit a property must be within 1,000 feet of a Metro Station Policy Area.

The amount of the credit is 80% of the County property tax on the property. The credit is available for 5 years and the owner may apply to renew the credit after 5 years, for another 5 years of tax credits. The total number of years a property may receive the credit is therefore 10 years. The tax credit will be terminated for years during which the property owner does not have more than $5,000 of gross income for the property.

Here is a link to the Application required to receive the credit: http://www.montgomerycountymd.gov/Finance/Resources/Files/Bill_31_16_Application.pdf 

If you fill out a paper version of the Application, please mail it to the Office of Agriculture at the address at the bottom of the application. 

Recap

A property is eligible for the Urban Agricultural tax credit if:
  1. It is between ½ acre and 3 acres and is zoned residential. Multiple, contiguous residential parcels owned by the same owner may be combined to meet the requirements of the law; AND
  2. The property is used solely for urban agricultural purposes;  AND
  3. The owner of the property receives more than $5,000 in gross income from the sale of products grown or raised on the urban agricultural property; AND
  4. The property is within 1,000 feet of a Metro Station Policy Area.
 
If at any time during a tax year a property is no longer used for agricultural purposes, as defined in the law, then the tax credit is terminated and the property owner must pay back the tax credit granted, if any, for the tax year during which the property was no longer used for agricultural purposes.

Urban Agricultural Purposes

Bill 31-16 defines Urban Agricultural Purposes as (1) the cultivation of fruits, vegetables, flowers and ornamental plants; (2) the limited keeping and raising of fowl or bees; or (3) the practice of aquaculture. In order to receive the tax credit, the property must be used solely for one or more of these purposes.

Gross Income Requirement

Bill 31-16 requires that the owner must receive at least $5,000 in gross income, each year, from the sale of agricultural products listed in Urban Agricultural Purposes (above). The owner may meet this requirement by donating more than $5,000 of agricultural products to an organization registered as a charitable organization with the Maryland Secretary of State.

Metro Station Policy Areas

Bill 31-16 requires that eligible properties must be in or within 1,000 feet of a Metro Station Policy Area.

The Metro Station Policy Areas are:
 
  1. Bethesda Central Business District
  2. Friendship Heights  
  3. Glenmont 
  4. Grosvenor 
  5. Rockville Town Center 
  6. Shady Grove   
  7. Silver Spring Central Business District 
  8. Twinbrook 
  9. Wheaton Central Business District 
  10. White Flint 
An application must be made each year for the tax credits. Application will be made to the Montgomery County Office of Agriculture, which will certify each property for the tax credit, each year. 

The application for the credit is due by April 1, before the tax year that begins on July 1 of the same calendar year. Tax years begin on July 1st—the 2017 tax year begins on July 1, 2017. 

For 2017 taxes only, applications will be accepted until September 1, 2017. If you wish to receive a credit for your 2017 taxes, you must apply by September 1, 2017. 
For all other tax years, you must apply by April 1st. For example, if you wish to receive a 2018 tax credit (for the tax year that begins July 1, 2018), then you must apply for it by April 1, 2018.

This tax credit will not be issued on the annual property tax bill that is sent in July, instead it will be calculated and issued on a subsequent revision of your tax bill, with the tax credit appearing as a line item deduction on the bill. When the tax credit is issued, your revised bill will also be available on our website: https://www2.montgomerycountymd.gov/realpropertytax/default.aspx.  The revised bill amount will also be available by calling MC311 (dial 311 if you are in the County, and dial 240-777-0311 if you are calling from outside of Montgomery County).

A link to the bill that passed will be available when the bill is finalized. In the meantime, here is the packet of information that the County Council reviewed, when they reviewed and voted on the bill on March 7, 2017: http://www.montgomerycountymd.gov/COUNCIL/Resources/Files/bill/2016/20170307_31-16.pdf

Here is a link to the Application required to receive the tax credit: http://www.montgomerycountymd.gov/Finance/Resources/Files/Bill_31_16_Application.pdf​

A paper version of this application will be available at the Department of Finance, Division of Treasury, which is at 255 Rockville Pike, Suite L-15, Rockville, Maryland 20850. You may also call the County at 311, or 240-777-0311 (if you are out of the County when calling). Please note that the application should be sent to the Office of Agriculture (at the address on the Application.
 
 
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