Transfer/Sale of Ownership
A buyer may request to continue classification by signing and recording a Notice of Continuance at the time of transfer.
If the buyer requests to continue and the Assessor's Office determines that the land qualifies for continuance, all buyers must sign a Notice of Continuance before the conveyance is recorded or filed. Also, the Assessor's Office must sign the Real Estate Excise Tax Affidavit before the sale will be processed - this can only be done Monday through Thursday. An updated Timber Management Plan may be required from the new owners of Designated Forestland. New owners also assume all tax liability accrued by the previous owner, including liability related to this classification.
If the buyer does not want to continue in the classification, the seller must have the property removed from the program, before the transfer, by submitting the appropriate Owner's Request to Remove form to the Assessor's Office (Open Space and Farm & Agriculture or Designated Forestland). The compensating tax or additional tax, interest and penalty will be due at the time of sale and is the responsibility of the seller.
Additional Tax - Farm & Agricultural and Open Space Land
In most cases, when property is removed from current use classification additional tax and interest becomes due. A 20% penalty may also be added. A complete list of exceptions to additional tax can be found in WAC 458-30-300(5).
Additional tax equals the difference between the tax paid under the current use classification and the tax that would have been due without the exemption for the current year, plus the last four years for Farm & Ag or seven years for Open Space, plus interest. A 20% penalty is also applied if the property has not been classified for at least 10 years prior to the withdrawal or if the Assessor's Office issues written notice of intent to remove because the land no longer meets the criteria for classification.
Compensating Tax - Designated Forestland
In most cases, when property is removed from designated forestland compensating tax becomes due. A complete list of exceptions to compensating tax can be found in RCW 84.33.140(13).
Compensating tax is calculated by multiplying the difference between the Assessor's current market value and the current forestland value, times the current tax rate, times the number of years in the program (not to exceed ten).
