Qualified Farm Property Annual Report For Estate Tax Valuation

ET 36 Rev. 2/05 1st annual report Estate Tax Division 1-(800) 977-7711 tax.ohio.gov 2nd annual report Final annual report Qualified Farm Property Annual Report for Estate Tax Valuation (Ohio Revised Code Section 5731.011) Estate of: Decedent’s last name County in Ohio Case number Decedent’s first name and initial Decedent’s social security number Estate tax file number Date of death Part I – Identification Name of preparer Address City, state and ZIP code Telephone number of preparer Designation: please circle Attorney Executor Administrator(s) Date Received by Ohio Department of Taxation Part II – Description of farm property (please provide the location, street address and taxing district) Part III – Current farm owner’s name(s) and street address(es) 1. Has the farm property been devoted exclusively for agricultural use, within the meaning of Ohio Revised Code section 5713.30(A) since the date of the decedent’s death? Yes No 2. Has any farm property, valued at current agricultural use value (CAUV) in the return, been sold or split off in the last year? Yes No If yes, please provide the following information: / / Date of sale or transfer Sales price $ Total acreage Sold to Is this a qualified heir? Yes No 3. If the property has been sold or transferred, please also provide a copy of the most current county auditor’s property tax record card showing the CAUV calculation, parcel number, total acreage and current owner’s name. Part IV – Signature and Verification Under penalties of perjury, I declare that to the best of my knowledge and belief, the statements made herein are true and correct. Signature of preparer Date American LegalNet, Inc. www.FormsWorkflow.com ET 36 Rev. 2/05 Page 2 General Information The four-year rule R.C. Section 5731.011(E) The estate remains open for four years. The CAUV will be disallowed if, during that time, the farm property is transferred to a nonqualified heir or the estate discontinues the qualified use of the property. Qualified use is considered terminated if property passes to a nonqualified heir even though the property is still used for farming. If one of these situations occurs, the department must be notified within nine months and a recapture tax (explained below) will be assessed against the person who is disposing of the property or terminating the qualified use. Annual report The qualified heirs are required to file an annual report, estate tax form 36, on the second, third and fourth anniversaries of the decedent’s date of death. The first annual report is due no sooner than 60 days before and no later than the second anniversary date of the decedent’s date of death. Failure to timely file the annual reports will result in the assessment of the recapture tax. Please provide a copy of the most current county auditor’s property tax record card showing the CAUV calculation, parcel number, total acreage and current owner’s name with the final annual report. The recapture tax is the amount of tax savings realized in the decedent’s estate because of the reduction in value of the farm property. For example: Assume the estate tax return shows all property at fair market value resulting in a tax of $25,000. However, when the estate reduces the farm property to CAUV, the tax actually due is only $8,000. Therefore, the savings realized is $17,000. This amount would also be the amount of recapture tax. The payment of recapture tax is the responsibility of the qualified heirs. Interest is calculated on the recapture tax from nine months after the decedent’s date of death. If a qualified heir dies, no recapture tax will be assessed. If any portion of the CAUV property is sold, transferred or converted to nonqualified use, the estate must file an amended estate tax form 2X showing the increase from the current CAUV value to the fair market value. The estate will also be required to file an amended estate tax form 34 reflecting the sale or conversion of the property. If the sale is to another qualified heir, there is no recapture tax. If the sale is to a nonqualified heir, the recapture tax is assessed based upon the percentage of tax the portion of property sold generates. If the property sold is either the one-acre homesite or building only, there is no recapture tax, since that part of the property was originally included and taxed at fair market value. Recapture tax R.C. Section 5731.011(E) Payment Amended filings Miscellaneous information regarding the sale of CAUV property Where to file the completed estate tax form 36 Ohio Department of Taxation Estate Tax Division P.O. Box 183050 Columbus, OH 43218-3050 (800) 977-7711 or (614) 387-1976 or FAX to (614) 387-1984 American LegalNet, Inc. www.FormsWorkflow.com