How to Forestry Land

TLDR || We classified most of our property as “forestry land” to avoid some taxes, if you own vast swaths of land it might be a good idea for you to do the same.

The thing you really want || You can download the forest plan I wrote to use as an example by clicking here – I’m pretty sure I redacted all of the things showing our actual location, if I missed something be nice.

What is Forestry Land

Glad you asked. Forestry land is land designated for the purpose of growing and  harvesting timber. In Washington state, where we live, we have the option of classifying land as Forestry land, subject to local assessor approval, and a few other caveats. The local assessor’s office who collects our property taxes, and who has the power to allow a land classification change, is the assessor for Kitsap County. Kitsap seems to want 20 or more acres in a forestry application, but I’ve been told they will be nice and allow it if you have 7 or more acres, a great plan, and ask super-duper nice like. We own a bit more than 20 acres of land, so it was simple to meet the size requirements.

For more information – Washington States Forestry land pamphlet

Why convert your land & Math

If you homestead / live on your land you need to designate a portion of the land as buildable. In our case we allocated an acre of land from each plot as buildable leaving the rest as forestry. The main benefit of reclassifying your land is the upfront tax savings. Unlike other reclassifications of land where you have to allow public access to your land, forestry land maintains your ability to keep your land private. We like less taxes and privacy.

We’re planning on staying where we are as long our kids are in K-12 school, so 18+ years with next kiddo due in July. We have no plans of clearing all of the land we own. In reality we’d like to add some more trees, build some trails, put in a large pond, and make the land more better and useful to our family. The things we plan to do with the land fit well with the forestry classification, and paying less taxes fit well with our goals of hording / saving more money

Some Math – The current tax assessed value for an acre of land where we live is about 15,000$ per acre. The current tax assessed value for an acre of forestry land is 125$ per acre.

  • Math here {(20 * 15,000 = 300,000$ land value) > (20 * 125 = 2,500$ land value)} our effective tax rate this year was about 11$ of tax per 1,000 of value.
  • More math {(300,000 * (11/1000) = 3,300$ tax bill) > (2,500 * (11/1000) = 27.50$) pretty big tax savings if you roll it out over 18 + years.

The catches of the forestry land classification are not too horrible. If you sell timber the local municipality, in our case Kitsap County, receives a portion of the gross sales of the timber. If you sell the property and or remove the land from classification, then you owe up to 9 years of back property taxes.

The Process to Change Classification

The process is mostly paper work with a bit of some walking around your property:

  1. Step 1 – Visit your local assessor’s office and obtain the paper work and any supporting documentation they might provide around the process
  2. Step 2 – Write a 10 to 50 year timber management plan for your property
  3. Step 3 – Turn in the paper work. After turning in the paper work the assessor comes out and checks the land then approves or asks for more
  4. Step 3 – Wait until the next tax year to receive the sweet sweet tax savings

Writing the plan took me about 8 hours of research and writing. If you figure those hours vs. the tax savings from this year I made about 400$ an hour, and will be paid for those hours every year as long we own the land. The timber management plan consists of a description of the land, your vision for the land, existing conditions of the land, existing stands of trees, future plans for the land, and a management time line.

I know what trees look like, have an idea how to write, and have a talent for being able to instantly apply research. If this does not sound like something you can or want to do then there is the option of hiring someone to write the plan for you.

Some assessors require a professional to have authored your timber management plan. Thankful our office is not one of those. Click here if you want to download the plan we used.

Our first reduced tax Bill

I was looking at our annual property tax bill last week, and based on my findings, we were going to pay 26$ in property taxes for the year. I was excited, and confused, and afraid. While 26$ would have been awesome to pay, someday that “glitch” would most likely bite us in the arse. Not wanting to be bitten I asked the county to pretty please charge us more. I copied Michelle on the email, which set off her thinking some. A few hours later she worked out my error. She has a way of proving she’s smarter then me in a cute way. Having been shown the error in my ways, I told the county “sorry, never mind, my smarter than me wife figured it out

When we broke our land up into buildable land and forestry land classifications we created parent and child taxable parcel numbers. Result is, each plot of land we own is now taxed separately and we get two bills for each plot. I found the forestry bills; I did not dig deep enough to find the child buildable bills. Michelle found the children parcels. 26$ would have been so much better then 4,000$; le sigh. Thanks Les.

Never ever thought I’d send something asking to be taxed more.

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