360° Coverage : How To Ranch Like Tom Cruise On A Lower Budget

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How To Ranch Like Tom Cruise On A Lower Budget
Photo Credit: Forbes Business

How To Ranch Like Tom Cruise On A Lower Budget

Jan 1 2014, 12:05pm CST | by

Not everybody can be Tom Cruise, but even without taking up Scientology, there are ways of participating in the Tom Cruise experience.  For example, it was reported that Tom Cruise was paying $400...

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30 weeks ago

How To Ranch Like Tom Cruise On A Lower Budget

Jan 1 2014, 12:05pm CST | by

Not everybody can be Tom Cruise, but even without taking up Scientology, there are ways of participating in the Tom Cruise experience.  For example, it was reported that Tom Cruise was paying $400 in property tax on an $18 million getaway ranch in Colorado.  The great property tax deal was courtesy of Colorado’s generous agricultural exemptions and a few sheep who kept the grass short.  Here is a story on Farmer Tom by my blogging buddy, Kay Bell.  Storm Mountain Ranch was designed to share the gentleman gentlelady ranching experience with those a bit down the economic ladder from Tom Cruise.

Storm Mountain Ranch describes itself as “ a fully established, private, gated ranch community, located less than 10 minutes east of Steamboat Springs, Colorado. The ranch is a conservation development on approximately 1100 acres with only 14 Homeowners.” Storm Mountain took the agricultural exemption a little further, asserting that the residences were integral to agricultural operations much like the ranch house on the Ponderaso where Ben Cartwright issued orders to Hoss and Little Joe.

The county assessors for Routt County saw it differently which brought the matter before the Colorado Board of Assessment Appeals (Sorry have not found a free link.)   The property had previously been considered agricultural, but the assessors thought that House Bill 11-146 which calls for carving up to two acres of land on which a “residential improvement” is located  out of the agriculturally exempt land unless the improvement is “integral to an agricultural operation”.

The argument about whether the residences were integral to the operation of the ranch was all about what the residents were doing, since apparently nobody was keeping a horse or a tractor in their garage.  The discussion reminded me a lot of the type of discussion you will see in passive activity and hobby loss cases. Storm Mountain’s argument was, in part, that since the agricultural operation was not leased out, but rather run by the Homeowners Association, each of the homeowners, by virtue of membership and dues paying was participating in agricultural operations.  There was more to it than that.

Petitioners serve on HOA committees and participate in quarterly HOA meetings where decisions regarding the agriculture program, budgeting, capital improvements, equipment, and water rights are discussed. The HOA Board oversees the SMR employees. Petitioners also participate in informal meetings at the ranch addressing agriculture program issues. These informal meetings can occur as owners encounter each other or the ranch manager on the road and stop to talk; as they meet each other elsewhere on the ranch property, and at social gatherings. All Petitioners who appeared testified that they spray weeds and are involved in creek and ditch maintenance on their individual lots that support the SMR agriculture program.

The assessor saw it differently.

The attendance charts show that some Petitioners are regular participants, some are occasional participants, and some rarely participate. The witness concluded that Petitioners are several steps removed from the agriculture operation on their lots because of the HOA, the full-time SMR staff, and the agricultural program leases. The witness also concluded that the activities of the individual Petitioners do not meet the statutory requirements to qualify them as integral to the agriculture operation on their lots.

The Board went with the assessor further noting that some of the activity like weed killing was being done more in their capacity as homeowners than in support of the agricultural operation.

Even though, the assessor won on the primary issue, that the residential portion of the lots were not integral to the agricultural operation, the overall decision was for the most part in favor of the homeowners.  The “residential envelope” for each homeowner was one acre.  The rest of their acreage (either 34 or 69 acres) maintains its agricultural classification.  The assessor argued that most of the value of the entire parcel should go to the residential acres, which gave them each a valuation of $1,430,000.  The Board ruled that an acre is an acre and the acre with the house on it was no different than any of the others which ended up with a valuation of $60,000 per lot.

So it would seem that a condominium style version of the Tom Cruise getaway experience, complete with bargain real estate taxes, is still available to the not quite 1% among us.

You can follow me on twitter @peterreillycpa.

Source: Forbes Business

 
Update
10

7 weeks ago

RM47mil KWSG contributions still unclaimed

Jun 9 2014 7:54am CDT | Source: Business Times Malaysia

KUALA LUMPUR: About RM47 million of contributions in the Teachers Provident Fund (KWSG) still remain unclaimed, the ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
9

7 weeks ago

Gold shop lost almost RM1mil

Jun 9 2014 3:50am CDT | Source: Business Times Malaysia

KANGAR: A gold shop owner lost almost RM1 million after after the safe on in his shop was broken into by robber ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
8

7 weeks ago

Motion to debate MAS losses in Dewan Rakyat rejected

Jun 9 2014 3:39am CDT | Source: Business Times Malaysia

KUALA LUMPUR: AN emergency motion to debate the losses incurred by Malaysia Airlines last year, amounting to RM1.2 billion was rejecte ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
7

7 weeks ago

MH370 Tragedy: Hisham: RM27.6 mil spent on 1st phase of SAR

Jun 9 2014 2:11am CDT | Source: Business Times Malaysia

KUALA LUMPUR: Malaysia spent some RM27.6 million in its first phase of the search operations for missing Malaysia Airline flight MH370, said Acting Transport Minister, Datuk Ser ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
6

7 weeks ago

9.1m litres of diesel seized in a month

Jun 8 2014 1:11am CDT | Source: Business Times Malaysia

PUTRAJAYA: The Domestic Trade, Cooperatives, and Consumerism ministry has seized some 9.1 million litres of diesel and property worth RM58 million since mounting ‘Operasi Diesel Selatan’ in the southern states last ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
5

7 weeks ago

Girl, 9, awarded RM2.78m compensation for medical negligence

Jun 6 2014 4:56am CDT | Source: Business Times Malaysia

KUALA LUMPUR: A nine-year-old girl who suffered brain damage during her birth at a government hospital was awarded over RM2.78 million in compensat ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
4

7 weeks ago

Malaysia's total trade in April up 12pc

Jun 5 2014 11:52pm CDT | Source: Business Times Malaysia

KUALA LUMPUR: Malaysia's total trade in April 2014 rose by 12 per cent from a year ago to RM123.86 billion due to growing trading activities, International Trade and Industry Minister Dat ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
3

8 weeks ago

Works Ministry to spend RM20m for upgrading works at 50 accident black spots

Jun 4 2014 11:35pm CDT | Source: Business Times Malaysia

JOHOR BARU: The Works Ministry will implement upgrading works at 50 accident prone locations in the country that have been identified this year involving an allocation of R ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
2

8 weeks ago

Najib launches loan scheme for Ramadan traders

Jun 4 2014 10:24pm CDT | Source: Business Times Malaysia

PUTRAJAYA: Prime Minister Datuk Seri Najib Razak today launches RM45 million Ramadan Bazaar ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 
Update
1

8 weeks ago

Residents bring up objection against Kidex to Suhakam

Jun 4 2014 4:49am CDT | Source: Business Times Malaysia

PETALING JAYA: A group of 20 Petaling Jaya residents held a meeting with the Human Rights Commission of Malaysia (Suhakam) over their objection against the proposed RM2.2 billion ...
Source: Business Times Malaysia   Full article at: Business Times Malaysia
 

 

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