Have a Farm for Sale, Ohio? What You Need to Know!

Farm for Sale OhioA farm for sale Ohio has to offer is not the same as selling a house – and as a commercial real estate investor, you know that understanding that fact is rarely the first step to actually making the sale.

While by no means do we want to imply that it is not a complicated process; we want to make it easier for you to understand what you need to do and when you need to do it. With that in mind, we have broken down what you need to know to push your land for sale in Ohio quickly into two main points: 1) land evaluation; and 2) taxes.

Okay, so it doesn’t sound glamorous or fun; but who said commercial property investment was always glamorous and fun? (Actually, we think it is, but that’s why we’re a company dedicated to it and aiming to help you right now.)

 

Selling the Farm: Phase 1 – Evaluation of the Farm for Sale Ohio

When buyers are looking to purchase Ohio farmland for sale, they will have a lot of things to consider when evaluating the specific land. Although you may have evaluated your land when you purchased it, and have since appraised it for value, you should also take the time to go through the motions of considering who your buyers might be and what they may be evaluating.

Tip: “Web Soil Survey ” provides soil classification and ratings that those looking to buy farmland can use to evaluate soil. Look up your land and get in the know.

What You’ll Need to Know: When it comes to land use, you’ll want to pay attention to zoning restrictions, covenants, easements, and agricultural use restrictions, to name a few. The last one is particularly important; because properties that are said to meet criteria for agricultural use are taxed at a lower rate. Learn more about that in the next phase, below.

 

Selling The Farm: Phase 2 – Tax Rates and Treatment of the Farm for Sale Ohio

The thing about taxes is that no one enjoys them (unless you’re an accountant). With that in mind, we know that just the word has you running.

There are various tax rates and tax treatments that apply to the different types of assets involved with the farm for sale Ohio. If you’re aware of the tax rates and treatments ahead of time, it will make the entire process much easier for you when you do go to sell your farmland (and less of a surprise when it comes time to pay the taxes).

Below are the 5 taxes to pay attention to:

  1. Federal ordinary income tax: You will be taxed at rates up to 39.6%, depending on taxable income.
  2. Depreciation recapture: You will be taxed at a rate of 25% on all depreciation recapture.
  3. Federal capital gain taxes: You will owe federal capital gain taxes either 15 or 20% on the economic gain (dependent on taxable income).
  4. New Medicare surtax: The Health Care and Education Reconciliation Act of 2010 added a new 3.8% Medicare surtax on “net investment income.” This surtax applies to taxpayers with “net investment income” that exceeds threshold income amounts of $200,000 for single filers and $250,000 for married couples filing jointly.
  5. State taxes: You will also be responsible for any applicable state taxes, which vary depending on location.

How you own your farm will impact the tax treatment of the above taxes when you list your farm for sale Ohio. Typically, entities for farm real estate are as follows:

Tip: The way in which you allocate the sales price to the assets of the farm for sale Ohio has to offer will determine the tax you may pay. Don’t go at it alone. Consult with your tax advisors and property advisors as you list the price and negotiate it. It is imperative that you seek direction from your tax advisers when purchase price allocation is being negotiated. Remember, there are various tax saving tools you can use to your advantage, too.

 

Listing Your Property for Sale

Now that you’ve done your homework and prepared your farm or farms for sale in Ohio, you’ll want to actually list it for sale, right?

Your farm most likely represents a large investment and you want to choose the right team to represent you in listing it. At The Robert Weiler Company, we have been providing our experience and expertise to Columbus, Ohio and throughout Central Ohio since 1938. Call one of our land brokers at 614-221-4286 to assist you in obtaining a top price for your farm for sale Ohio.