Over the last two articles, I have discussed what agritourism is, what some of the rules surrounding it are, and how it can benefit you. In this article, I will explore the legal and tax protections that agritourism offers.
Keeping and Expanding Your Tax Benefits
Ben Franklin once said that death and taxes are the only two unavoidable aspects of life, and he was not wrong. While agritourism will not prevent your farm from having to pay taxes, it allows your business to qualify for a CAUV reduction, homesteading protections, or other tax credits and keep those you already have in place. In addition to maintaining your existing credits, by expanding your business and exploring different fields of service, you could qualify for additional taxing credits and possibly even federal grants.
Keeping the Zoning Inspector at Bay
One of the primary advantages of agritourism is that it allows you to run an additional business while still running the functioning farm. This means that particular zoning rules, like classification of property, or paved parking requirements, do not apply to your property. Certain codes, especially those related to safety or health, will remain applicable.
Making a Dry Township Wet
By limiting the rights of a county or township zoning inspector, agritourism allows you to convert your hops into beer and your grapes into wine, right on your property. If you expand into an associated brewhouse, winery, or similar concept, you can qualify to sell that beer or wine to the general public or use that property to host certain events otherwise not permitted.
Keeping the Fire Marshall at Bay
Unlike the zoning inspector, predominantly what a fire marshal inspects directly relates to health or safety concerns. That said, a number of these concerns relate to the classification of the property, not the use, and thus would not apply to an agritourism business.
Pipelines, Mineral Rights, and Easements Are Not Impacted
Generally speaking, transforming your farm into agritourism will not impact your easement or pipeline. Most agritourism activities only occur in a designated area of the property. This area is likely already used for farming or similar activities and be limited away from any easement or pipeline route. Due to most agritourism activities occurring on the surface, they will generally leave your mineral concerns unharmed.
Saying Goodnight to County and Township Bed Taxes
With the rise of self-booked B&Bs, renting rooms for a night, and other internet-based rental styles, counties and townships have expanded their bed taxes from only hotels to any lodging. By turning your property into an agritourism business, it could be possible to transform these taxes into a lesser camping tax rate or avoid some of them altogether.
Creating a Liability Shield
If you’ve ever been in an orchard, you know that sometimes poisonous weeds will grow. If you’ve ever been around a horse, you know that eventually it will buck, or kick. These dangers are inherent on farms and ranches, and transforming your business into agritourism does not require you to eliminate these risks. Instead, the law provides a liability shield for agritourism businesses, which will apply to most general farming and rural risks. However, this shield does not protect against all liabilities.
It is Easy to Add Agritourism to Your Existing Policies and Concepts
Agritourism is not an altogether new business but technically an extension of your existing agricultural use. This means that many of your insurance policies, taxing systems, contracts, and, importantly, internal business structures, can be adapted for the expansion.
To qualify for any of these protections, not only does your farm has to meet particular requirements under the law, but you also have to follow specific regulations. Further, the law requires your farm to post very specialized signs, under specific conditions, ensuring these protections are triggered. In my next article, I will discuss those qualifications and requirements further.
If you want to explore your farm’s future, EQUES Law Group has the top-notch talent you need with the hometown approach you want. With over 50 years of legal experience, our team understands you and your farm’s unique needs and goals and has the skills to win in front of a Zoning Board or in the Courtroom. We are prepared and happy to address every legal concern your agritourism business will raise.
Attorney At Law