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Volume 1 - Opinions of Counsel SBEA No. 4

Opinions of Counsel index

Farm exemption (horticultural use) (retail sales) - Real Property Tax Law, § 483:

Although the growing of nursery stock falls within the definition of a “horticultural use”, a building used for reception, display and sale of such stock is not entitled to the farm exemption since it is primarily used for retail merchandising rather than the raising and production for sale of a horticultural commodity.

Section 483 of the Real Property Tax Law provides for an exemption on structures and buildings essential to the operation of lands, not less than five acres in area, which for at least two consecutive years prior to the date of application for exemption have been actively devoted to agricultural and horticultural use, and are actually used and occupied to carry out such operation for profit. Such buildings must be constructed or reconstructed subsequent to January 1, 1969, and prior to January 1, 1979, in order to be exempt from taxation to the extent of any increase in the value of the agricultural or horticultural operation attributable to such buildings. The period of exemption is limited to five years.

Subdivision 3 of section 483 provides, in part, that “[t]he term ‘structures and buildings’ shall include: (a) structures and buildings or portions thereof used directly and exclusively in the raising and production for sale of agricultural and horticultural commodities or necessary for the storage thereof, but not structures and buildings or portions thereof used for the processing of agricultural and horticultural commodities or necessary for the storage thereof used for the processing of agricultural and horticultural commodities, or the retail merchandising of such commodities * * *.”

Although the growing of nursery stock falls within the definition of a “horticultural use”, a building used for reception, display and sales of such stock is not entitled to the farm exemption since it is primarily used for retail merchandising rather than the raising and production for sale of a horticultural commodity.

April 23, 1970

Updated: