§ 137b.89. Calculation of roll-back taxes.

 A county assessor shall calculate roll-back taxes using the following formula:

   (1)  If preferential assessment has been in effect for 7 tax years or more, calculate the difference between preferential assessment and normal assessment in the current tax year, and in each of the 6 tax years immediately preceding the current tax year. If preferential assessment has been in effect for less than 7 tax years, calculate the difference between preferential assessment and normal assessment in the current tax year, and in each of the tax years in which the enrolled land was preferentially assessed.

   (2)  With respect to each of these sums, multiply that sum by the corresponding factor, which reflects simple interest at the rate of 6% per annum from that particular tax year to the present:

      Year
Factor
Current Tax Year   1.00
1 Tax Year Prior   1.06
2 Tax Years Prior   1.12
3 Tax Years Prior   1.18
4 Tax Years Prior   1.24
5 Tax Years Prior   1.30
6 Tax Years Prior   1.36

   (3)  Add the individual products obtained under Step (2). The sum equals total roll-back taxes, including simple interest at 6% per annum on each year’s roll-back taxes.

  Example 1: Landowner’s liability for roll-back taxes is triggered on July 1, 7 or more tax years after preferential assessment began. The county assessor calculates the difference between the preferential assessment and normal assessment in the current tax year and in each of the 6 tax years preceding the current tax year, in accordance with this section. The county assessor determines the appropriate sum to be $2,000 in each full year, and prorates this sum with respect to the current tax year.

    Year
Amount Multiplied
by Factor
Current Tax Year   $1,000 x 1.00 = $1,000
1 Tax Year Prior   $2,000 x 1.06 = $2,120
2 Tax Years Prior   $2,000 x 1.12 = $2,240
3 Tax Years Prior   $2,000 x 1.18 = $2,360
4 Tax Years Prior   $2,000 x 1.24 = $2,480
5 Tax Years Prior   $2,000 x 1.30 = $2,600
6 Tax Years Prior   $2,000 x 1.36 = $2,720
TOTAL ROLL-BACK   $15,520
TAXES, WITH INTEREST:

  Example 2: Landowner’s liability for roll-back taxes is triggered on July 1, less than 7 tax years after preferential assessment began. The county assessor calculates the difference between the preferential assessment and normal assessment in the current tax year and each of the tax years since preferential assessment began, in accordance with this section. The county assessor determines the appropriate sum to be $2,000 in each of these years. The county assessor would calculate roll-back taxes and interest in accordance with the chart set forth in Example 1, calculating for only those tax years in which preferential assessment occurred.


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