The agricultural land transfer tax (tax) rates are as follows: The rate is 3 percent for a transfer of less than 20 acres of agricultural land with either or both of the following included in the sale price of the lot or parcel: Structures or other items that are separately assessed by the Department; or Site improvements, for example, street, curb, sewer, water, septic, and well. The rate is 4 percent for a transfer of less than 20 acres of unimproved agricultural land. The rate is 5 percent for a transfer of agricultural land greater than or equal to 20 acres, whether improved or unimproved. Reduction in Tax. Except as provided in Tax-Property Article, §13–305(b)(2) or (c)(4), Annotated Code of Maryland, the agricultural land transfer tax is reduced by: 25 percent if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment for 1 full taxable year before a transfer; 50 percent if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment for 2 full consecutive taxable years before a transfer; and 65 percent if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment for 3 or more full consecutive taxable years before a transfer. In addition to the agricultural land transfer tax imposed under this subtitle, certain counties may impose county agricultural land transfer tax. In addition to the agricultural land transfer tax, a surcharge in an amount equal to 25 percent of the tax is imposed on an instrument of writing that transfers title to agricultural land, except for an instrument of writing that transfers property of 2 acres or less to be improved to a child or grandchild of the owner. Under Tax-Property Article, §13-304, Annotated Code of Maryland, the supervisor is required to deduct from the consideration payable for the instrument of writing the “total value”, as defined in Tax-Property Article, §13-301(d), Annotated Code of Maryland, of any improvement on the property before applying the applicable tax rate and surcharge. For this purpose, the supervisor shall deduct only the total value of any structure or other item that is separately assessed on the property's assessment worksheet. For example, a 5-acre parcel transfers for a consideration of $250,000. It is improved with an outbuilding that has a separately itemized value of $175,000 on the property's assessment worksheet. The parcel is also improved with certain site improvements — a driveway, a well, a septic system, and sidewalks — which are all included in the $50,000 land value portion on the assessment worksheet, but are not set out on the worksheet with a separate value for each item. The tax and surcharge are calculated as follows: Under Tax-Property Article, §13-304, Annotated Code of Maryland, the supervisor is required to deduct from the consideration payable for the instrument of writing the “total value”, as defined in Tax-Property Article, §13-301(d), Annotated Code of Maryland, of any land not subject to the tax and surcharge before applying the applicable tax rate and surcharge. For example, a 10-acre parcel transfers for a consideration of $500,000. One acre of that parcel is a homesite assessed at $100,000 that is not subject to the tax and surcharge. The tax and surcharge are calculated as follows: Both §§A and B of this regulation may apply in the same transaction. For example, a 10-acre parcel transfers for a consideration of $500,000. It is improved with a dwelling that has a separately itemized value of $175,000 on the property's assessment worksheet. The parcel is also improved with certain site improvements — a driveway, a well, a septic system, and sidewalks — which are all included in the land value portion on the assessment worksheet, but are not set out on the worksheet with a separate value for each item. It also includes a 1-acre homesite assessed at $100,000 that is not subject to the tax and surcharge. The tax and surcharge are calculated as follows: The supervisor of assessments in each county shall maintain adequate records to administer the tax. These records shall include the identification of parcels receiving agricultural use assessment and parcels subject to declarations of intent. The supervisor shall calculate the tax and surcharge, and the body of the written instrument conveying title shall be stamped or electronically noted with the local tax collecting authority’s verification of the amount of tax and surcharge, if any, due. The local tax collecting authority shall collect the tax and surcharge before the supervisor processes the instrument. The agricultural land transfer tax and surcharge do not apply to an instrument of writing that transfers title to agricultural land that was previously transferred by an instrument of writing that was subject to the agricultural land transfer tax. The following are nonexclusive examples of violations of a declaration of intent where the tax, surcharge, and penalty are imposed on that portion of the land subject to the violation: Discontinuing or failing to maintain an agricultural activity on the land; Constructing nonagricultural improvements or nonagricultural site improvements on the land; Transferring part of the land so that the remaining land no longer qualifies for agricultural use assessment; Developing a residential building site on the land; Subdividing the land so that it no longer qualifies for agricultural use assessment; and Rezoning the land under Tax-Property Article, §8-209(h), Annotated Code of Maryland. General Rule. Except as provided in §B of this regulation, a person appeals the imposition of the tax by first paying the tax. The person then files a written request for refund with the supervisor for the county where the tax was paid. After the person is afforded an opportunity to be heard, the supervisor notifies the person in writing of the supervisor's determination regarding the refund request, which the person may appeal to the Maryland Tax Court under Tax-Property Article, §14-512(d), Annotated Code of Maryland. A final order of the Tax Court may be appealed to the circuit court under Tax-General Article, §13-532, Annotated Code of Maryland. Declaration of Intent Violation. When the tax, surcharge, and penalty are imposed because there is a violation of a declaration of intent under Tax-Property Article, §13-305, Annotated Code of Maryland, the supervisor determines the value of the land and imposes the tax, surcharge, and penalty on that value. This value is determined as of the most recent July 1, based on the condition and characteristics of the land as of the date of violation. The supervisor notifies the person in writing of the value and the amount of tax, surcharge, and penalty due. The tax, surcharge, and penalty are due on the earlier of the next date on which property tax is due on the land or the date of the next transfer of any part of the land. If the tax, surcharge, and penalty are not yet due under §B(2) of this regulation, the person may appeal the imposition of the tax, surcharge, and penalty to the supervisor under Tax-Property Article, §14-506, Annotated Code of Maryland, without paying the tax, surcharge, and penalty. After affording the person an opportunity to be heard, the supervisor shall notify the person of the supervisor's determination regarding the appeal, which may be appealed to the Tax Court under Tax-Property Article, §14-512(b), Annotated Code of Maryland. A final order of the Tax Court may be appealed to the circuit court under Tax-General Article, §13-532, Annotated Code of Maryland. An appeal under this subsection does not postpone the due date of the tax, surcharge, and penalty. If the person pays the tax, surcharge, and penalty, his appeal rights with regard to the tax, surcharge and penalty are as set forth in §A of this regulation. Whether or not the person pays the tax, surcharge, and penalty, the person may appeal the value used to determine the amount of tax, surcharge, and penalty to the supervisor. Further appeal of the value is to the local property tax assessment appeal board for the county where the land is situated, the Tax Court, and then the circuit court, under Tax-Property Article, §§14-509(a) and 14-512(f)(2), and Tax-General Article, §13-532, Annotated Code of Maryland. Tax-Property Article, §§2-201, 2-202, and 13-307, Annotated Code of Maryland Effective date: January 7, 1982 (8:26 Md. R. 2106) Regulation .01 amended effective September 27, 1982 (9:19 Md. R. 1897) Regulation .01G amended effective October 8, 1984 (11:20 Md. R. 1743); December 31, 1984 (11:26 Md. R. 2281) Regulation .01 repealed and new Regulations .01—.06 adopted effective December 2, 1996 (23:24 Md. R. 1684) Regulation .01 amended effective June 29, 2020 (47:13 Md. R. 643) Regulation .02 amended effective December 23, 2013 (40:25 Md. R. 2070); June 29, 2020 (47:13 Md. R. 643) Regulation .04 amended effective June 29, 2020 (47:13 Md. R. 643) Regulation .04A amended effective January 24, 2022 (49:2 Md. R. 78) Regulation .05 amended effective June 29, 2020 (47:13 Md. R. 643) Regulation .06B amended effective June 29, 2020 (47:13 Md. R. 643)