Texas Restricted Use Timberland Valuation Pays Very Low Property Taxes
Texas Property Tax Code 2021 Chapter 23 Subchapter H
Restricted use timber land is subject only to deminimus property taxes. However, there are detailed requirements to qualify. But if you own timberland and do not plan to harvest it, obtaining a restricted use timber land valuation is worthwhile.
Texas Property Tax Code
2021 Edition
Texas Comptroller of Public Accounts
The Texas Property Tax Code available on this website are current through the Regular Session of the 87th 2nd Called Legislative Session, 2021. The Texas Constitution is current through the amendments approved by voters in November 2019.
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TITLE 1. PROPERTY TAX CODE
SUBTITLE D. APPRAISAL AND ASSESSMENT
CHAPTER 23. APPRAISAL METHODS AND PROCEDURES
SUBCHAPTER H. APPRAISAL OF RESTRICTED-USE TIMBER LAND
Sec. 23.9801. DEFINITIONS. In this subchapter:
(1) “Aesthetic management zone” means timber land on which timber harvesting is restricted for aesthetic or conservation purposes, including:
(A) maintaining standing timber adjacent to public rights-of-way, including highways and roads; and
(B) preserving an area in a forest, as defined by Section 152.003, Natural Resources Code, that is designated by the director of the Texas Forest Service as special or unique because of the area’s natural beauty, topography, or historical significance.
(2) “Critical wildlife habitat zone” means timber land on which the timber harvesting is restricted so as to provide at least three of the following benefits for the protection of an animal or plant that is listed as endangered or threatened under the Endangered Species Act of 1973 (16 U.S.C. Section 1531 et seq.) and its subsequent amendments or as endangered under Section 68.002, Parks and Wildlife Code:
(A) habitat control;
(B) erosion control;
(C) predator control;
(D) providing supplemental supplies of water;
(E) providing supplemental supplies of food;
(F) providing shelters; and
(G) making of census counts to determine population.
(3) “Management plan” means a plan that uses forestry best management practices consistent with the agricultural and silvicultural nonpoint source pollution management program administered by the State Soil and Water Conservation Board under Section 201.026, Agriculture Code.
(4) “Regenerate” means to replant or manage natural regeneration.
(5) “Streamside management zone” means timber land on which timber harvesting is restricted in accordance with a management plan to:
(A) protect water quality; or
(B) preserve a waterway, including a lake, river, stream, or creek.
(6) “Qualified restricted-use timber land” means land that qualifies for appraisal as provided by this subchapter.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Sec. 23.9802. QUALIFICATION FOR APPRAISAL AS RESTRICTED-USE TIMBER LAND. (a) Land qualifies for appraisal as provided by this subchapter if the land is in an aesthetic management zone, critical wildlife habitat zone, or streamside management zone.
(b) Land qualifies for appraisal as provided by this subchapter if:
(1) timber was harvested from the land in a year in which the land was appraised under Subchapter E; and
(2) the land has been regenerated for timber production to the degree of intensity generally accepted in the area for commercial timber land and with intent to produce income.
(c) Land ceases to qualify for appraisal under Subsection (b) on the 10th anniversary of the date the timber was harvested under Subsection (b)(1). This subsection does not disqualify the land from qualifying for appraisal under this section in a tax year following that anniversary based on the circumstances existing in that subsequent tax year.
(d) In determining whether land qualifies for appraisal as provided by this subchapter, a chief appraiser may not consider the purpose for which a portion of a parcel of land is used if the portion is:
(1) used for the production of timber or forest products, including a road, right-of-way, buffer area, or firebreak; or
(2) subject to a right-of-way that was taken through the exercise of the power of eminent domain.
(e) For the purpose of the appraisal of land under this subchapter, a portion of a parcel of land described by Subsection (d) is considered land that qualifies for appraisal under this subchapter if the remainder of the parcel of land qualifies for appraisal under this subchapter.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 43 (H.B. 1409), Sec. 3, eff. September 1, 2019.
Sec. 23.9803. APPRAISAL OF QUALIFIED RESTRICTED-USE TIMBER LAND. (a) Except as provided by Subsection (b), the appraised value of qualified restricted-use timber land is one-half of the appraised value of the land as determined under Section 23.73(a).
(b) The appraised value determined under Subsection (a) may not exceed the lesser of:
(1) the market value of the land as determined by other appraisal methods; or
(2) the appraised value of the land for the year preceding the first year of appraisal under this subchapter.
(c) The chief appraiser shall determine the market value of qualified restricted-use timber land and shall record both the market value and the appraised value in the appraisal records.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Sec. 23.9804. APPLICATION. (a) A person claiming that the person’s land is eligible for appraisal as provided by this subchapter must file a valid application with the chief appraiser.
(b) To be valid, an application for appraisal under Section 23.9802(a) must:
(1) be on a form provided by the appraisal office and prescribed by the comptroller;
(2) provide evidence that the land qualifies for designation as an aesthetic management zone, critical wildlife habitat zone, or streamside management zone;
(3) specify the location of the proposed zone and the quantity of land, in acres, in the proposed zone; and
(4) contain other information necessary to determine the validity of the claim.
(c) To be valid, an application for appraisal under Section 23.9802(b) must:
(1) be on a form provided by the appraisal office and prescribed by the comptroller;
(2) provide evidence that the land on which the timber was harvested was appraised under Subchapter E in the year in which the timber was harvested;
(3) provide evidence that all of the land has been regenerated in compliance with Section 23.9802(b)(2); and
(4) contain other information necessary to determine the validity of the claim.
(d) The comptroller shall include on the form a notice of the penalties prescribed by Section 37.10, Penal Code, for making or filing an application containing a false statement. The comptroller, in prescribing the contents of the application form, shall require that the form permit a claimant who has previously been allowed appraisal under this subchapter to indicate that the previously reported information has not changed and to supply only the eligibility information not previously reported.
(e) The form must be filed before May 1. However, for good cause shown, the chief appraiser may extend the filing deadline for not more than 15 days.
(f) If a person fails to file a valid application on time, the land is ineligible for appraisal as provided by this subchapter for that year. Once an application is filed and appraisal under this subchapter is allowed, the land is eligible for appraisal under the applicable provision of this subchapter in subsequent years without a new application unless the ownership of the land changes, the standing timber is harvested, or the land’s eligibility under this subchapter ends. However, if the chief appraiser has good cause to believe the land’s eligibility under this subchapter has ended, the chief appraiser may require a person allowed appraisal under this subchapter in a previous year to file a new application to confirm that the land is currently eligible under this subchapter by delivering a written notice that a new application is required, accompanied by the application form, to the person who filed the application that was previously allowed.
(g) The appraisal office shall make a sufficient number of printed application forms readily available at no charge.
(h) Each year the chief appraiser for each appraisal district shall publicize, in a manner reasonably designed to notify all residents of the district, the requirements of this section and the availability of application forms.
(i) A person whose land is allowed appraisal under this subchapter shall notify the appraisal office in writing before May 1 after eligibility of the land under this subchapter ends. If a person fails to notify the appraisal office as required by this subsection, a penalty is imposed on the property equal to 10 percent of the difference between the taxes imposed on the property in each year it is erroneously allowed appraisal under this subchapter and the taxes that would otherwise have been imposed.
(j) The chief appraiser shall make an entry in the appraisal records for the property against which the penalty is imposed indicating liability for the penalty and shall deliver a written notice of imposition of the penalty to the person who owns the property. The notice shall include a brief explanation of the procedures for protesting the imposition of the penalty. The assessor for each taxing unit that imposed taxes on the property on the basis of appraisal under this subchapter shall add the amount of the penalty to the unit’s tax bill for taxes on the property against which the penalty is imposed. The penalty shall be collected at the same time and in the same manner as the taxes on the property against which the penalty is imposed. The amount of the penalty constitutes a lien on the property against which the penalty is imposed and on delinquency accrues penalty and interest in the same manner as a delinquent tax.
(k) If the chief appraiser discovers that appraisal under this subchapter has been erroneously allowed in any of the 10 preceding years because of failure of the person whose land was allowed appraisal under this subchapter to give notice that the land’s eligibility had ended, the chief appraiser shall add the difference between the appraised value of the land under this subchapter and the market value of the land for any year in which the land was ineligible for appraisal under this subchapter to the appraisal records as provided by Section 25.21 for other property that escapes taxation.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Sec. 23.9805. ACTION ON APPLICATION. (a) The chief appraiser shall determine separately each applicant’s right to have the applicant’s land appraised under this subchapter. After considering the application and all relevant information, the chief appraiser shall, as soon as practicable but not later than the 90th day after the later of the date the applicant’s land is first eligible for appraisal under this subchapter or the date the applicant provides to the chief appraiser the information necessary for the chief appraiser to determine the applicant’s right to have the applicant’s land appraised under this subchapter, based on the law and facts:
(1) approve the application and allow appraisal under this subchapter;
(2) disapprove the application and request additional information from the applicant in support of the claim; or
(3) deny the application.
(b) If the chief appraiser requires additional information from an applicant, the chief appraiser shall, as soon as practicable but not later than the 30th day after the date the application is filed with the chief appraiser, deliver a written notice to the applicant specifying the additional information the applicant must provide to the chief appraiser before the chief appraiser can determine the applicant’s right to have the applicant’s land appraised under this subchapter. The applicant must furnish the information not later than the 30th day after the date of the request or the chief appraiser shall deny the application. However, for good cause shown, the chief appraiser may extend the deadline for furnishing the information by written order for a single period not to exceed 15 days.
(c) The chief appraiser shall determine the validity of each application for appraisal under this subchapter filed with the chief appraiser before the chief appraiser submits the appraisal records for review and determination of protests as provided by Chapter 41.
(d) If the chief appraiser denies an application, the chief appraiser shall deliver a written notice of the denial to the applicant not later than the fifth day after the date the chief appraiser makes the determination. The notice must state and fully explain each reason the chief appraiser denied the application. The chief appraiser shall include with the notice a brief explanation of the procedures for protesting the denial.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Amended by:
Acts 2021, 87th Leg., R.S., Ch. 533 (S.B. 63), Sec. 13, eff. September 1, 2021.
Sec. 23.9806. APPLICATION DENIAL BASED ON ZONE LOCATION. (a) Before a chief appraiser may deny an application under Section 23.9805 on the ground that the land is not located in an aesthetic management zone, critical wildlife habitat zone, or streamside management zone, the chief appraiser must first request a determination letter from the director of the Texas Forest Service as to the type, location, and size of the zone, if any, in which the land is located.
(b) The chief appraiser shall notify the landowner and each taxing unit in which the land is located that a determination letter has been requested.
(c) The director’s letter is conclusive as to the type, size, and location of the zone for purposes of appraisal of the land under this subchapter.
(d) If the land is located in a zone described in the determination letter, the chief appraiser shall approve the application and allow appraisal under this subchapter if the applicant is otherwise entitled to have the applicant’s land appraised under this subchapter.
(e) The director of the Texas Forest Service by rule shall adopt procedures under this section. The procedures must allow the chief appraiser, the landowner, and a representative of each taxing unit in which the land is located to present information to the director before the director issues the determination letter.
(f) Chapters 41 and 42 do not apply to a determination under this section by the director of the Texas Forest Service of the type, size, and location of a zone.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Sec. 23.9807. CHANGE OF USE OF LAND. (a) If the use of land that has been appraised as provided by this subchapter changes to a use that qualifies the land for appraisal under Subchapter E, an additional tax is imposed on the land equal to the difference between:
(1) the taxes imposed on the land for each of the three years preceding the year in which the change of use occurs that the land was appraised as provided by this subchapter; and
(2) the taxes that would have been imposed had the land been appraised under Subchapter E in each of those years.
(b) If the use of land that has been appraised as provided by this subchapter changes to a use that does not qualify the land for appraisal under Subchapter E or under this subchapter, an additional tax is imposed on the land equal to the difference between:
(1) the taxes imposed on the land for each of the three years preceding the year in which the change of use occurs that the land was appraised as provided by this subchapter; and
(2) the taxes that would have been imposed had the land been taxed on the basis of market value in each of those years.
(c) A tax lien attaches to the land on the date the change of use occurs to secure payment of the additional tax imposed by this section and any penalties and interest incurred if the tax becomes delinquent. The lien exists in favor of all taxing units for which the additional tax is imposed.
(d) The additional tax imposed by this section does not apply to a year for which the tax has already been imposed.
(e) If the change of use applies to only part of a parcel that has been appraised as provided by this subchapter, the additional tax applies only to that part of the parcel.
(f) A determination that a change in use of the land has occurred is made by the chief appraiser. The chief appraiser shall deliver a notice of the determination to the owner of the land as soon as possible after making the determination and shall include in the notice an explanation of the owner’s right to protest the determination. If the owner does not file a timely protest or if the final determination of the protest is that the additional taxes are due, the assessor for each taxing unit shall prepare and deliver a bill for the additional taxes as soon as practicable after the change of use occurs. The taxes are due and become delinquent and incur penalties and interest as provided by law for ad valorem taxes imposed by the taxing unit if not paid before the next February 1 that is at least 20 days after the date the bill is delivered to the owner of the land.
(g) The harvesting of timber from the land before the expiration of the period provided by Section 23.9802(c) constitutes a change of use of the land for purposes of this section.
(h) The sanction provided by Subsection (a) or (b) does not apply if the change of use occurs as a result of a:
(1) sale for right-of-way;
(2) condemnation; or
(3) change in law.
Added by Acts 1999, 76th Leg., ch. 631, Sec. 5, eff. Jan. 1, 2000.
Amended by:
Acts 2021, 87th Leg., R.S., Ch. 726 (H.B. 3833), Sec. 7, eff. June 15, 2021.
Sec. 23.9808. OIL AND GAS OPERATIONS ON LAND. The eligibility of land for appraisal under this subchapter does not end because a lessee under an oil and gas lease begins conducting oil and gas operations over which the Railroad Commission of Texas has jurisdiction on the land if the portion of the land on which oil and gas operations are not being conducted otherwise continues to qualify for appraisal under this subchapter.
Added by Acts 2019, 86th Leg., R.S., Ch. 43 (H.B. 1409), Sec. 4, eff. September 1, 2019.
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