Agricultural Use Exemption
This publication does not constitute tax, legal or other advice. It is intended as a guide only, and the application of its contents to a specific situation will depend on the circumstances involved. This publication should not be relied on as a substitute for obtaining professional advice or for researching the specific sources of authority cited herein.
Definition of Agricultural Real Property.
To qualify as agricultural real property, real property must be “actually used for agricultural purposes.” This means that the property must be currently used for bona fide agricultural purposes. Intended or future use is not determinative.
(SC Code §12-43-220(d);See also SC Commission Decision 92-77. 10 SCRegs. 117-1780.1; SC Commission Decision 92-77.)
Agricultural real property is defined as “any tract of real property which is used to raise,
harvest or store crops, feed, breed or manage livestock, or to produce plants, trees, fowl or
animals useful to man, including the preparation of the products raised thereon for man’s
use and disposed of by marketing or other means.”
SC Code §12-43-230
Additional Requirements for Agricultural Real Property
provides additional requirements that must be met in order for real property to qualify as
agricultural real property. The requirements are as follows:
- Timberland: If the tract is used to grow timber, the tract must be five acres or more.
Tracts of timberland of fewer than five acres qualify if they are contiguous to, or are
under the same management system as, a tract of timberland that meets the minimum
acreage requirement. Tracts of timberland of fewer than five acres are eligible to be
agricultural real property if they are owned in combination with other tracts of
agricultural real property that are not timberlands but qualify as agricultural real
property. Tracts of timberland must be devoted actively to growing trees for
2. Christmas Trees: A tract devoted to growing Christmas trees must be five acres or
more. If the tract is fewer than five acres, it will qualify as agricultural real property
if at least $1,000 of gross farm income was reported for at least three of the last five
3. Other Acreage: All other tracts must be at least ten acres or more. Tracts of fewer
than ten acres qualify as agricultural real property if they are contiguous to other
tracts that total at least ten acres when combined. Tracts that do not meet this
requirement will qualify if at least $1,000 of gross farm income was reported for at
least three of the last five tax years.
4. New Ownership: A new owner may qualify a non-timberland tract of fewer than ten
acres if he earns at least $1,000 of gross farm income in at least three of the first five
years of ownership. If the new owner fails this requirement, the tract is not
considered agricultural real property and is subject to the rollback tax.
( SC Code §12-43-232)
10 SC Regs. 117-1780.1 further defines agricultural real property. It provides six nonexclusive
factors to be considered by county assessors in determining whether the tract in
question is bona fide agricultural real property:
(1) the nature of the terrain;
(2) the density
of the marketable product (timber, etc.) on the land;
(3) the past usage of the land;
(4) the economic merchantability of the agricultural product;
(5) the use or not of recognized care, cultivation, harvesting and like practices applicable to the product involved, and any
implemented plans thereof; and
(6) the business or occupation of the landowner or lessee, provided that purchase for investment purposes does not disqualify a tract if it is actually
used for agricultural purposes.
The following uses of real property do not qualify as agricultural:
(2) hunting clubs;
(3) fishing clubs;
(4) vacant land lying dormant; or
(5) any other similar use.
(10 SC Regs. 117-1780.1)
NOTE: See next section on Roll Back Taxes to explain how up to five years taxes may apply when agricultural real property use class is changed to a new use such as subdivision or commercial use.