Moving to Texas or thinking about raising chickens and wondering; do chickens qualify for AG exemption in Texas? The answer is; Yes, chickens can qualify for Agricultural Exemption, although there are many eligibility requirements.
I’ll say off the top; this is a topic best discussed with a qualified tax professional if you want an accurate answer, as there are some stipulations that will be specific to your individual circumstances.
That said, I’ve done some research into the topic of AG exemptions in Texas to help you out. Here is an overview of what exactly AG exemptions are, whether or not chickens qualify, and what it may mean to you where it matters - in tax dollars savings.
What Is an Agricultural Exemption?
An Agricultural Exemption or an AG Exemption for short as it’s more commonly referred to is a special valuation that applies to some agricultural landowners in Texas.
Basically, what it means is that if you have agricultural land, you’re able to have your property’s taxes calculated based on how you’re using that land for commercial purposes - as opposed to strictly taking it at market value.
This law was originally passed to protect family farms from being taxed out of existence, as they obviously had a lot of land to maintain and use for business purposes.
There is a long list of rules and stipulations, and I’ve done my best to summarize them below if you want to jump straight to whether or not you’ll be eligible.
In summary, what the AG Exemption means is that if you are raising cattle, selling eggs, crop production, or using your land for just about anything related to farming and agriculture you may be eligible.
My understanding is that it’s not always easy to get an exemption in the first place (when are tax savings easy to get, right?). So, you need to put time into doing your due diligence.
But once you are accepted, you can keep and maintain your exemption and make some serious tax savings every year.
Can Chickens Be Used for AG Exemption in Texas?
According to the Agricultural Land Use Guidelines and Standards for Texas, chickens can be used for an AG exemption, yes.
This is great news for all chicken owners. But before you get carried away, it's not as simple as saying you have some backyard chickens and getting ‘farm credits’ as the tax exemption is often called.
You need to prove a number of things. Most notably that you’re keeping chickens for profit and using them to run a business.
This can either be raising them for meat or selling their eggs. If you’re simply raising backyard chickens for fun or your own consumption, unfortunately, you’re not going to be eligible for any relief.
How to Qualify for AG Exemption in Texas
Some of the core criteria you need to fulfill to be eligible for farm credits or tax exemption is:
- You must have used your property for at least 5 out of the last 7 years for agricultural purposes.
- You must be able to prove that you are using your land to generate profit.
- Your land must currently be being used in a way that it can carry.
- You must have a certain number of acres of land (varies per county).
In addition to this, you must have at least one animal unit per 5-10 acres of improved pasture land. Or, you must have at least one animal unit per 15-25 acres of native pasture land.
That brings up the question, “ what is an animal unit?”
An animal unit (AU) is defined in the Agricultural Land Use Guidelines and Standards for Texas as:
- 500 Pound Calves = 1 animal unit
- Cow & Calf = 1 animal unit
- Bull = 1 ½ animal unit
- Horse = 1 animal unit
- Sheep or goats = 1 animal unit
- Miniature horses or donkeys = 1 animal unit
Chickens are not included in the animal unit classification. I enquired about this and how many chickens equal 1 animal unit, etc, but I didn’t get a sufficient answer.
Related - You can find hatcheries by state in our hatchery listings here.
How Many Acres Do You Need to Qualify for AG Exemption in Texas?
You do need to have a certain number of acres to qualify for AG Exemption in Texas. The exact number varies depending on the county you live in, however, so you’ll need to check with your local office.
As a general rule of thumb, expect to be told that you need at least 10 acres of land.
How Much Does AG Exemption Save in Texas
This is impossible to answer as there are so many factors that depend on whether or not you're even eligible, let alone how much you will save.
One thing I can say for sure is that if you do qualify, it is almost certainly going to be worth it. Otherwise, why would they even offer an exemption, right?
Keep in mind that this exemption was created to help farmers and other commercial businesses operate with the land they have without taxing them too heavily for owning the land.
Hopefully, I've helped answer some questions and clear up some of the confusion you may have had about whether or not you can qualify for AG Exemption in Texas
While it's very unlikely that anyone with backyard chickens is going to be eligible, for those of you with larger farming operations that may be, I wish you good luck!
Image credits - Photo by Zoe Schaeffer on Unsplash