2022 Local Government Tax Law Changes

Adds the boarding of horses to the definition of “the commercial production or growing of animals” for purposes of determining eligibility for participation in the Present-Use Value Program.

(Effective for taxable years beginning on or after July 1, 2022; SB 726, s. 6.(a), S.L. 2022-55.)

Rewords the conservation exception for Present-Use Value income and production requirements, and updates reference to relevant conservation easement statute:

Property may continue to qualify “without regard to actual production or income requirements of this section as long as (i) the property is subject to a qualifying conservation easement that meets the requirements of G.S. 113A-235(a); and (ii) the taxpayer received no more than seventy-five percent (75%) of the fair market value of the donated property interest in compensation.”

(Effective June 23, 2022; HB 83, s. 6.1, S.L. 2022-13.)

Recodifies and renumbers the section [(c)(1) becomes (c1); (c)(2) becomes (c2); and(c)(3) becomes (c3)], and makes some substantive changes:

• (a)(6): Defines “Wildlife conservation land. – Land that meets the size, ownership, and use requirements of this section.”
• (b): Establishes three different property classification types, along with the respective Present-Use Value schedule to be used in appraising the property (previously, all qualifying property was appraised as agricultural land): 
  “(1) Wildlife conservation land used for wildlife species protection under subdivision (c3)(1) of this section must be appraised and assessed as if it were classified under G.S. 105-277.3 as forestland. 
  (2) Wildlife conservation land used for wildlife habitat protection under subdivision (c3)(2) of this section must be appraised and assessed as if it were classified under G.S. 105-277.3 as forestland.
  (3) Wildlife conservation land used for wildlife reserve under subdivision (c3)(3) of this section must be appraised and assessed as if it were classified under G.S. 105-277.3 as agricultural land.”
• (c1): Size requirement, previously 20 contiguous acres, now: “20 contiguous acres located in the same county. Once the initial qualifying tract of 20 contiguous acres has been met, one or more additional acres that meet the ownership and use requirements of this section may qualify for enrollment. If the land is used for wildlife habitat protection under subdivision (c3)(2) of this section, then the additional acreage must be located in the same county as the qualifying 20-acre tract.”
• (c2): Ownership requirement, previously requiring five years of ownership by an individual, a family business entity, or a family trust, now permits ownership by a combination of these owners as tenants in common. In addition, the statutes reduces the required length of ownership to four years, and provides further exceptions to this time requirement:
  “(1) If the land is the owner's place of residence, then it meets the ownership requirements. 
  (2) If an owner of land enrolled as wildlife conservation land under this section acquires additional land that shares a common boundary with the enrolled land, then the acquired land meets the ownership requirement.” …[(5), formerly (3), allowing continued participation by a new owner of land already enrolled in the Wildlife Conservation Land Program, is reworded without significant change.] 
  …”(6) If the land is owned as tenants in common, the land meets the ownership requirement if the land was owned by one or more of the tenants for the required time. 
  (7) If the land is acquired through transfer or inheritance from a relative, the land meets the ownership requirement if the land was owned by the relative for the required time.”
• (c3): Defines qualifying land uses, all of which must be managed under a written agreement with the North Carolina Wildlife Resources Commission:
  (1) – Protect an animal species that lives on the land and, as of January 1 of the year for which the benefit of this section is claimed, is on a North Carolina protected animal list published by the Commission under G.S. 113-333.
  (2) Wildlife habitat protection. – Conserve any of the following priority animal wildlife habitats: longleaf pine forest, early successional habitat, small wetland community, stream and riparian zone, rock outcrop, or bat cave.
  (3) Wildlife reserve. – Create and actively and regularly use as a reserve for hunting, fishing, shooting, wildlife observation, or wildlife activities, provided that the land is inspected by a certified wildlife biologist at least quintennially to ensure that at least three of the seven activities listed in this subdivision are maintained to propagate a sustaining breeding, migrating, or wintering population of indigenous wild animals for human use, including food, medicine, or recreation. The Commission shall adopt rules needed to administer the inspection requirements of and activities mandated by this subdivision. The activities are as follows:
  a. Supplemental food 
  b. Supplemental water 
  c. Supplemental shelter 
  d. Habitat control 
  e. Erosion control 
  f. Predator control 
  g. Census of animal population on the land
• (d) Increases the maximum amount of land that may qualify from 100 acres to 200 acres.

(Effective for taxable years beginning on or after July 1, 2022; SB 388, s. 3.(a) through s. 3.(c), S.L. 2022-45.)

Provides that a foreclosure sale made pursuant to G.S. 105-374 is subject to “…(iv) conservation agreements, as defined in G.S. 121- 35(1).”

(Effective June 30, 2022; SB 726, s. 4.(a), S.L. 2022-55.)

Provides that an execution sale made pursuant to G.S. 105-375 is subject to “…conservation agreements, as defined in G.S. 121-35(1).”

(Effective June 30, 2022; SB 726, s. 4.(b), S.L. 2022-55.)