Legal Definitions - optimal-use value

Definition: Optimal-use value refers to the highest and best use of a thing from an economic standpoint. It is the value that a property or asset would have if it were used in the most profitable way possible.

Example: If a piece of land is currently being used for farming, but it is located in an area where commercial development is booming, the optimal-use value of the land would be the value it would have if it were used for commercial development instead of farming. This value would be higher than the current value of the land as a farm.

This concept is important in taxation because it helps determine the fair market value of a property or asset. It is also relevant in business decision-making, as it helps determine the most profitable use of resources.