As used in this chapter, unless the context otherwise requires:
1.“Activelyengagedinfarming”meansthedesignatedpersonispersonallyinvolvedinthe
productionofcropsandlivestockontheeligibletractonaregular,continuous,andsubstantial
basis. However, a lessor, whether under a cash or a crop share lease, is not actively engaged
in farming on the area of the tract covered by the lease. This provision applies to both written
and oral leases.
2.“Agricultural land” means land in tracts of ten acres or more excluding any buildings or
other structures located on the land, and not laid off into lots of less than ten acres or divided
by streets and alleys into parcels of less than ten acres, lying within a school corporation and
in good faith used for agricultural or horticultural purposes. Any land in tr
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As used in this chapter, unless the context otherwise requires:
1. “Activelyengagedinfarming”meansthedesignatedpersonispersonallyinvolvedinthe
productionofcropsandlivestockontheeligibletractonaregular,continuous,andsubstantial
basis. However, a lessor, whether under a cash or a crop share lease, is not actively engaged
in farming on the area of the tract covered by the lease. This provision applies to both written
and oral leases.
2. “Agricultural land” means land in tracts of ten acres or more excluding any buildings or
other structures located on the land, and not laid off into lots of less than ten acres or divided
by streets and alleys into parcels of less than ten acres, lying within a school corporation and
in good faith used for agricultural or horticultural purposes. Any land in tracts laid off or
platted into lots of less than ten acres belonging to and a part of other lands of more than
ten acres and in good faith used for agricultural or horticultural purposes is entitled to the
benefits of this chapter.
3. “Crop” or “crop production” includes pastureland.
4. “Designated person” means one of the following:
a. If the owner is an individual, the designated person includes the owner of the tract,
the owner’s spouse, the owner’s child or stepchild, and their spouses, or the owner’s relative
within the third degree of consanguinity, and the relative’s spouse.
b. If the owner is a partnership, a partner, or the partner’s spouse.
c. If the owner is a family farm corporation, a family member who is a shareholder of the
family farm corporation or the shareholder’s spouse.
d. If the owner is a family farm limited liability company, a family member who is a
member of the family farm limited liability company or the member’s spouse.
e. If the owner is an authorized farm corporation, a shareholder who owns at least
fifty-one percent of the stock of the authorized farm corporation or the shareholder’s spouse.
f. If the owner is an authorized limited liability company, a member who holds at least
fifty-one percent of all membership interests in the authorized limited liability company, or
the member’s spouse.
g. If the owner is an individual who leases the tract to a family farm corporation, a
shareholder of the corporation if the combined stock of the family farm corporation owned
by the owner of the tract and persons related to the owner as enumerated in paragraph “a”
is equal to at least fifty-one percent of the stock of the family farm corporation.
h. If the owner is an individual who leases the tract to a family farm limited liability
company, a member of the family farm limited liability company if the combined interests of
the family farm limited liability company held by the owner of the tract and persons related
to the owner as enumerated in paragraph “a” is equal to at least fifty-one percent of the
interests of the family farm limited liability company.
i. If the owner is an individual who leases the tract to a partnership, a partner if the
§425A.2, FAMILY FARM TAX CREDIT 2
combined partnership interest owned by a designated person as defined in paragraph “a” is
equal to at least fifty-one percent of the ownership interest of the partnership.
5. “Eligible tract” or “eligible tract of agricultural land” means an area of agricultural land
which meets all of the following:
a. Is comprised of all of the contiguous tracts under identical legal ownership that are
located within the same county.
b. In the aggregate more than half the acres of the contiguous tract is devoted to the
production of crops or livestock by a designated person who is actively engaged in farming.
c. For purposes of paragraph “b”, if some or all of the contiguous tract is being farmed
underaleasearrangement,theactivitiesofthelessordonotconstitutebeingactivelyengaged
in farming on the areas of the tract covered by the lease. If the lessee is a designated person
who is actively engaged in farming, the acres under lease may be considered in determining
whether more than half the acres of the contiguous tract are devoted to the production of
crops or livestock.
6. “Owner” means any of the following:
a. An individual who holds the fee simple title to the agricultural land.
b. An individual who owns the agricultural land under a contract of purchase which has
been recorded in the office of the county recorder of the county in which the agricultural land
is located.
c. An individual who owns the agricultural land under devise or by operation of the
inheritance laws, where the whole interest passes or where the divided interest is shared
only by individuals related or formerly related to each other by blood, marriage, or adoption.
d. An individual who owns the agricultural land under a deed which conveys a divided
interest, where the divided interest is shared only by individuals related or formerly related
to each other by blood, marriage, or adoption.
e. A partnership where all partners are related or formerly related to each other by blood,
marriage, or adoption.
f. A family farm corporation, family farm limited liability company, authorized farm
corporation, or authorized limited liability company, as defined in section 9H.1, which owns
the agricultural land.