Commercial, Industrial, and Business Personal Property are valued based on consideration of the cost,
market and income approach to appraisal as specified by § 39-1-103(5)(a), C.R.S.
Commercial property is assessed at 29% of its actual value. If your commercial real estate is valued at $100,000, your assessed value is $29,000. To calculate your taxes, multiply the assessed value by the mill levy. Remember that the mill levy is expressed in mills, which is 1/1000, so multiply by the mills, but move the decimal three places to the left.
Example: $100,000 x .29% x 83 mills = $100,000 x .29 x .083 = $2,407.00
Real property also includes Possessory Interests.
Personal Property includes equipment, machinery, and other items. More information on Personal Property.
Notices of Value are mailed on or before May 3. For more information on Notices of Value.
More information on Property Valuation for Business and Industry in Colorado.
Agricultural land is:
• Located in an incorporated or unincorporated area (without regard to zoning)
• Used in the last two years and presently used as a farm or ranch (or is being restored through conservation practices through a conservation district approved plan)
• A parcel of land used as a farm or ranch with a decreed water right or final permit to appropriated ground water for non-residential purposes and the water is used for production of agricultural or livestock products
• Forest land: 40 acres or more of forest land that is subject to a forest management plan (land is used to produce tangible wood products for profit)
• Conservation easements: 80 acres or more of land (or less than 80 acres with no residential improvements) subject to a perpetual conservation easement which was granted at the time the land was classified agricultural. The easement must have been granted exclusively for conservation purposes and all current and future uses are described in the conservation easement.
• Farm – land used to produce agricultural products for the primary purpose of obtaining a monetary profit. Products include plant and animal products from farming, ranching, animal husbandry and horticulture.
• Ranch – land used for grazing livestock for the primary purpose of obtaining a monetary profit products for profit
• Livestock – domestic animals used for food for human or animal consumption, breeding draft, or profit products for profit
• Improvements – structures, buildings, fixtures, fences, and water rights attached to the land. Homes and buildings are appraised and valued separately from the land. Water rights, windmills and sprinklers are improvements that are appraised and valued as a unit with the land.
Agricultural land value is based on the actual value of agricultural lands, exclusive of building improvements, and is determined by the earning or productive capacity of such lands, capitalized at a rate of 13%, § 39-1-103(5)(a), C.R.S.
Earning or productive capacity is determined by measuring the landlord’s net income over a reasonable amount of time (the current 10-year average)
The net income is equal to the gross income less allowable expenses, including baling, fencing, water, fertilizer, alfalfa seed, and chemicals. Those expenses must be typical for the use.
The gross income is determined by the earning or productive capacity of the land.
To ensure that your property is classified properly, the Assessor may request additional information from you, which could be a copy of your previous year’s income tax 1040-F form, a grazing lease, or an agricultural land classification questionnaire. The Assessor may also conduct a physical inspection of your property.
Please note that there is a two-year waiting period after the year of application before the classification will take effect.
Application for Agricultural Classification
More information on Classification and Valuation of Agricultural Property in Colorado and to see ALL of the State of Colorado Division of Property Taxation Brochures
Vacant Land is assessed at 27.9% of actual value and valuation is based consideration of the cost, market and income approach to appraisal as specified by § 39-1-103(5)(a), C.R.S.
If you are have a vacant lot or parcel adjacent to your residence, you may want to consider vacating the boundary line between the parcels. You should contact your city or county planning department for assistance.
If you do not wish to vacate the boundary line, you may contact the Assessor’s office to complete a Request for Combination of Properties form. This request will combine the parcels, if certain conditions are met. The parcel of land without a residential improvement must be contiguous to the residential parcel must have identical ownership based on the record title and must contain a related improvement that is essential to the use of the residential improvement located on the identically owned contiguous residential land. There are other conditions, so you will need to call the Assessor’s office to request the form, a review, and an inspection.
Present Worth or Developers Discount
By law, the Assessor must consider and, if appropriate, apply present worth valuation procedures when using the market approach to valuing vacant land, § 39-1-103(14)(b), C.R.S.
Present worth valuation is usually applied to subdivision lots owned by developers or sub-dividers and, it involves discounting based on various factors. The use of present worth valuation is used to account for the time necessary to sell an inventory of vacant lots and, under Colorado law, equates to actual or market value.
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