By: Cam Merritt
More Articles
- 1. What Is Encroachment on Property?
- 2. What Is Property Tax Assessment?
- 3. How to Sell an Easem*nt
An "easem*nt" is the legal right to use or access real estate that belongs to someone else. When there's a right-of-way easem*nt on your property, the land still belongs to you, and therefore the property taxes remain your legal responsibility. That said, easem*nts raise a number of issues that could affect your taxes.
Terms
Right-of-way easem*nts are the most common kind of easem*nt. These easem*nts give someone else the right to use a specific portion of your property. For example, neighbors whose property is cut off from the road may have an easem*nt allowing them to drive across a 15-foot-wide section of your land to reach the road. Or a utility company may have an easem*nt allowing it to run a power line over a strip of your property, or bury a gas line under it. In legal terms, the "easem*nt" is the right to use the property, while the "right of way" is the portion of your property affected by the easem*nt. Right-of-way easem*nts are typically written into the deed of a property, meaning all future owners of the land are bound by them.
Tax Credits
Easem*nts don't change ownership of the property, so the land owner will still have to pay the property taxes on it. Some states and localities, however, give land owners a property tax credit for certain right-of-way easem*nts. In Minnesota, for example, you can receive a credit -- a discount on your property taxes, essentially -- for easem*nts for power lines. The amount of the credit is based on the length of the line crossing the property. Check with your local property tax assessing agency to see whether you're eligible for tax breaks for right-of-way easem*nts.
Side Agreements
It may be possible to require the person who benefits from an easem*nt to pay some or all of the property taxes on the right of way. But the time to do this is when the easem*nt is first set up -- when the property owner and the party seeking the easem*nt are negotiating the terms of the easem*nt. Once easem*nts are written into property deeds, they're pretty much set in stone. Further, the taxing authority may still place the full responsibility for property taxes on the land owner. It may be up to the landowner to enforce the agreement by collecting the other party's "share" of the taxes and, if necessary, going to court.
Effects on Value
Some right-of-way easem*nts have a negligible impact on the value of your property. For example, if a neighbor has the right to come onto your land occasionally to perform maintenance on his fence, that isn't going to significantly affect the enjoyment or use you get out of your property. But if someone has the right to drive across your land, it affects where you can plant trees, the amount of privacy you can expect on your land, and many other things. This reduces the value of your property, and that should be reflected in your tax assessment -- the value the government uses to determine your property tax. The easem*nt may be grounds for appealing a tax assessment you believe is too high.
References
Writer Bio
Cam Merritt is a writer and editor specializing in business, personal finance and home design. He has contributed to USA Today, The Des Moines Register and Better Homes and Gardens"publications. Merritt has a journalism degree from Drake University and is pursuing an MBA from the University of Iowa.
