Two-thirds of Iowa’s counties will have an increase in taxable values of farmland due to rising commodity prices, according to the Iowa Department of Revenue. Higher commodity prices will increase home values slightly, while commercial property values will see a relief.

The state’s new equalization order and annual rollback orders were recently presented to local assessors. The new rollback order shows that home will be taxed at 46.9% of their assessed value, up 1.3% from last year, according to the Des Moines Register.

Property taxes come from an equation that includes a percentage of the assessed value. Tax rates are derived from a complex equation that includes government needs. There is now way to tell if taxes will increase or decrease for individuals since government needs, such as road projects, can greatly affect taxes.

Farmland taxes

Over the past six years, Iowa farmland has doubled in value, reported the Des Moines Register. The taxable values of farmland depend upon a five-year average of commodity prices, which until recently increased much slower than farmland values.

Iowa caps the taxable value of farmland at a 4% increase per year. For the first time since the early 1980s, the taxable values went up the full 4% this term.

If the government is increasing taxable values as much as possible, then the government certainly thinks that farmland values are going to continue to increase. That way, in the future, the government will receive as much property tax as possible if values increase beyond that 4% maximum for taxable values.

-Colvin