Minnesota woodland property tax: 2C Managed Forest Land
Minnesota Laws 2008, Chapter 366 (House File 3149), created a new property tax classification–Class 2c Managed Forest Land. Its 0.65 percent class rate for 2008 is lower than other classifications in which forest land may be placed, except Class 2a Agricultural Homestead (0.50 percent).
Qualifications for 2c Managed Forest Land tax classification
To qualify, the parcel must:
- Be at least 20 acres of forest land based on the sum of all forest land covered under the same forest management plan located on contiguous parcels. Wooded acres may not be contiguous, but parcels on which they are located must be contiguous.
- Total enrolled acreage is limited to 1,920 acres statewide per taxpayer.
- Be unplatted property that is rural in character.
- Not be used for agricultural purposes.
- Not be improved with a structure. A minor ancillary nonresidential structure does not disqualify the property (e.g., sheds or other primitive structures, the aggregate size of which are less than 300 square feet that add minimal value and are not used residentially; provided that the occasional overnight use for hunting or other outdoor activities shall not preclude a structure from being considered a minor, ancillary structure.) If any structure or group of structures totals exceed these requirements, the property must be split classed according to the property’s current uses. At least 10 acres must be assigned to, and centered on, the structure. If a property must be split-classified and the resulting forest land is less than 20 acres, the property is not eligible for Class 2c.
- Open water, including rivers, that are less than three acres in size can be included as part of the forested land. Larger areas must be excluded. Marshes and other wetlands are eligible for Class 2c.
- Have a forest management plan in place that was developed by a MN DNR approved forest management plan writer within the last ten years. The forest management plan must meet the same requirements of forest management plans prescribed for property enrolled in the SFIA program (Chapter 290C). The MN DNR annually will send county assessors a list of property owners who have a registered forest management plan in each county. To continue to qualify for Class 2c, a property owner’s name must be listed on the MN DNR’s annual list of registered forest management plans. It is the landowner’s responsibility to register their plan with the MN DNR.
- Not be enrolled in the SFIA program. The MN DOR will provide counties with a list of parcels enrolled in the SFIA program so assessors can verify that any parcels in Class 2c are not enrolled in the SFIA program. If a parcel containing forest land has more than one use, land covered under a forest management plan should be split-classified as 2c (if an application has been made) and the remaining land should be classified according to its use. For example: a 360-acre parcel containing 60 acres of seasonal residential recreational and 300 acres of forest covered by a forest management plan should be split-classified: 60 acres as seasonal residential recreational and 300 acres as Class 2c.
The property owner must complete an application form CR-2cMFL-08 and provide it to the county assessor to verify that the property qualifies for Class 2c. This form is available from your county assessor or the MN DOR Website.
Applications will be accepted at your local county assessor’s office through May 1 every year. Attach your forest management plan to the application. You must follow the guidelines prescribed by the forest management plan if you wish to continue receiving the reduced class rate.
Forest management plans approved by the DNR will eventually list the number of acres eligible for Class 2c; however, in the near term the assessor is responsible for removing 10 acres for any structure or use that does not qualify as a minor ancillary nonresidential structure.
Other pages in this series:
Some useful links:
Perspective: Jeff Forester on problems & solutions with MN’s property tax code
MN DOR’s SFIA Fact Sheet
Sustainable Forests Incentive Act: Natural Resource Report (PDF) and SFIA FAQs (18 p. PDF)
More on 2c Managed Forest Land on our blog
MDA Conservation Funding Guide
The Minnesota woodland property tax series is authored by Mike Reichenbach and Mel Baughman.
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