Did you know individual homeowners have an opportunity to qualify for tax savings under North Carolina’s Agriculture, Horticulture, and Forestry Present-Use Value (PUV) Assessment Program?
EcoForesters, a nonprofit professional forestry organization dedicated to conserving and restoring Appalachian forests through education and stewardship, will hold a free workshop with the support of the North Carolina Forest Service on September 21. The “Hands on Forestry Workshop” will provide up-to-date information on tax incentives, forest preservation methods, and invasive species removal.
The N.C. State Extension Service will hold a separate “Forestry Landowner Summit” in Hendersonville on September 7 covering, “A wide selection of topics including forest farming, basic forestry terms, wildlife, forest succession, and private land recreation.”
Andy Tait, forestry/co-executive director of EcoForesters, listed several benefits that ecological timber harvesting provides landowners, including increased forest structural diversity, retention of large legacy trees, and longer intervals between harvestings at a workshop held in Haywood County earlier this year.
“Access to funding is the number one barrier private landowners face in managing their forests and improving or making profits from the land,” said Tait. “Things like treating the common issue of non-native invasive plant (e.g. kudzu) infestations or thinning overly dense stands to benefit oaks and reduce fire risk cost money, but there is some funding available to forest landowners.”
North Carolina legislators long ago recognized a funding gap prevented homeowners from effectively using their land for agricultural or forestry purposes. In 1974, the state introduced the PUV program to encourage the tradition of farming and forestry rather than seeing homeowners prematurely sell off the land and natural resources to developers.
Tommy Allen of the Macon County Tax Office, emphasized that the key to being accepted into the forestry PUV program is ensuring that the tracts of land held are, “at minimum, 20 acres in actual production [and are] covered by a forestry management plan. While some people may be qualified to develop their own plan, we prefer the plan to come, as the rules state, from a qualified forester.”
Homeowners can work with the local N.C. Forestry Service office, private forestry consultants, or groups such as EcoForesters to develop a sound, written, forest-management plan, which details actions to be taken by the landowner to support forest growth, maintenance, and harvesting for a period of 10 years. Once a forestry plan is written, the homeowner completes an AV-5 Application for Agriculture, Horticulture, and Forestry Present-Use Value Assessment and presents it along with a copy of the plan to the Macon County Tax Office.
“The only time the state allows us to accept applications for Present-Use Value is during the month of January,” explained Allen, who has overseen Macon County’s program for 20 years. “If you are approved, you will hear nothing further from us,” but you will see the deferment kick in on your next tax statement. If any remedies are needed for the plan, the office works with the homeowner to make corrections.
“Applications have held steady over the past few years,” said Allen, who received seven in 2023.
Although close to 50% of Macon County is held under U.S. Forest Service protection and most of the remaining parcels owned by private landowners fall below the 20-acre minimum, some private landowners still have enough acreage to qualify.
Macon County currently tracks 993 forestry plans, which can pass over to new owners.
Allen pointed out that new buyers must decide within 60 days of purchase if the land they are acquiring will remain in PUV status. “They have three options when they buy it. One, they can say they don’t want to stay in PUV and the seller must pay three years’ deferred taxes plus interest. Two, they can say they will assume liability from the previous owner and no back taxes must be paid, or the third way, which we see much more of today, is that [the new owner] wants to stay in PUV but does not want to assume the liability for back taxes … and the seller pays back taxes at closing.”
Allen reminded landowners that they are subject to compliance reviews to remain in PUV status. The audits are conducted to answer the question, “Did you do the things necessary to meet the obligations of [your] forestry plan?”
“A lot of people did not realize that if they didn’t do what the plan said, then they could owe some back taxes or when they come out [of the program] they could owe some rollback,” Allen cautioned, adding “I always tell people when they are filling out the form or if they have any questions, please just call. I will be more than happy to help.”
The Macon County Tax Office provides brochures and forms explaining the PUV program in detail. Interested landowners can stop by the Tax Office at 5 W. Main Street (Annex Building) or call (828) 349-2147 to obtain more information. Regional workshop information can be found at www.ecoforesters.org/outreach-events or https://forestry.ces.ncsu.edu/event/3041083594/forestry-landowner-summit/.