Farmland is not assessed on what it would sell for
Illinois assesses farmland on agricultural economic value from soil productivity, not sale price.
Farmland in Illinois is not assessed on what it would sell for. It is assessed on what it can produce, and that is a deliberate policy choice with large consequences.
Use-value assessment
Under Illinois law, farmland is valued by its agricultural economic value — a calculation derived from soil productivity, typical crop yields, prices and costs, capitalised at a statutory rate.
Not the price a developer would pay. Not the price a neighbour would pay. What the land can earn from farming.
Why
Without it, farmland near a growing town would be assessed at development value and taxed at a level no farming operation could sustain. The land would be forced out of agriculture by the tax bill alone. Use value assessment exists to prevent that.
How it is calculated
The Department of Revenue publishes certified values by soil productivity index. Each parcel's soils are mapped, each soil type has an index, and the assessed value per acre follows from the index rather than from the market.
Different parts of one field can carry different values, because the soils differ.
What this means for an appeal
The arguments are different from residential ones. Market comparables are irrelevant — what a neighbouring farm sold for tells you nothing about its assessment. The things that can be wrong are:
- The soil classification. The productivity index assigned to your soils. Soil surveys can be checked and are sometimes wrong at the parcel level.
- The acreage. How many acres are in each classification.
- The split between uses. Cropland, permanent pasture, woodland and wasteland are valued differently, and land that has changed use may not have been re-mapped.
- Whether it qualifies as farmland at all. There are use requirements, generally including a period of agricultural use before qualifying.
The homesite is separate
A farmhouse and the land immediately around it are assessed as residential, at 33⅓% of market value, not as farmland. So a farm parcel commonly carries two different assessment regimes, and errors in the split between them are worth checking.
When land comes out of farming
Development or a change of use ends the treatment, and Illinois may recapture some tax benefit for prior years. This catches people who assume the favourable assessment simply stops going forward.
What to do
- Get the soil productivity indices the assessor used and the acreage in each class.
- Compare against the published soil survey for your land.
- Check the use split — cropland against pasture against waste.
- Check that the homesite is separately and correctly assessed.
- Take advice for anything involving a change of use; the recapture provisions are where the expensive surprises live.