The Clock Ran Out. The Courthouse Door Did Not.
What the New Hampshire Supreme Court's Latest Current Use Tax Decision Means for Property Owners and Municipalities
Can you challenge a land use change tax assessment if you miss the abatement deadline? The New Hampshire Supreme Court says yes, at least when the challenge targets the town's authority to issue the assessment in the first place and not just the amount of the tax.
What Is Current Use, and When Does a Land Use Change Tax Apply?
Under RSA 79-A, qualifying open space land is taxed at its current use value rather than its full market value. The resulting tax is generally a fraction of what it otherwise would be.
To qualify, a parcel must meet the minimum acreage standard established by the Current Use Advisory Board, currently set at 10 acres.
When land no longer qualifies, the owner owes a one-time “land use change tax” (LUCT) equal to 10 percent of the land's full market value.
Among other things, land is considered changed in use when it drops below the minimum acreage.
The municipality must mail the LUCT bill within 18 months after its assessing officials receive written notice of the change of use or actually discover that the tax is due and payable.
Taxpayers unhappy with the amount of the LUCT may seek an abatement.
Background
In June 2021, a developer purchased three lots totaling 9.94 acres that had been carved from a larger parcel in current use. The conveyance reduced the land below the 10-acre threshold and triggered the LUCT. The deed was recorded and “provided to the town” on July 1, 2021.
The town mailed LUCT bills (one for each lot) in February 2023, more than 18 months after July 1, 2021. The developer paid the bills under protest and timely sought abatements. The town did not respond.
The developer missed the ensuing deadline to appeal the town's inaction. The developer instead filed a superior court action arguing that the town lacked authority to issue the bills after the 18-month period following receipt of the deed had expired.
Superior Court
The superior court dismissed the action based on the missed abatement appeal deadline.
Supreme Court
The Supreme Court reversed. A taxpayer who challenges the legal authority of a municipality to issue a LUCT assessment, as opposed to challenging the amount of the tax, is not required to exhaust its abatement remedies. The court held that the developer's claim raised a pure question of statutory interpretation and that the courthouse door was not closed by the missed abatement deadline.
The court framed the open question on remand as “whether the change in use date or some other operative date triggers the beginning of the 18-month period.”
The statute provides the 18-month period begins with some form of municipal notice or actual discovery of the change in use rather than the change in use date. Yet the remand suggests that the change-in-use date may play a more direct role in the analysis. Whether that reflects an issue left unresolved by the statute or merely shorthand for the broader timeliness inquiry remains to be seen.
Key Takeaway
A taxpayer who misses the RSA 79-A abatement deadline may still use a declaratory judgment action to challenge a municipality’s authority to issue a land use change tax assessment in the first place rather than a dispute over the amount of the tax.
McMaster Development, LLC v. Town of Derry, No. 2025-0131 (non-precedential order) (Sep. 16, 2026). (Because the Court issued an "order" rather than an "opinion," the ruling has no precedential authority over other cases, but it may provide guidance on how New Hampshire courts may approach similar issues in the future.)
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