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farm tax?

H

Howard Parker

Member
I order some parts for my John Deere two-cylinder tractors from Deere dealer they asked if I farm with it I said no so they said they had to tax me for the parts I thought all farm tractors were tax exempt I don't own any farm land so they said had to be taxed I do plow and disk alittle on friends farm how much land do you need to own to be farm tax exempt? a little confused thanks Howard
 
State of Tennessee issues a farm tax exemption number based on you supplying a copy of federal income tax form schedule F. That is if you have farm income and expenses you can claim exemption on purchases used for the farm .
 
(quoted from post at 18:39:58 09/08/16) I order some parts for my John Deere two-cylinder tractors from Deere dealer they asked if I farm with it I said no so they said they had to tax me for the parts I thought all farm tractors were tax exempt I don't own any farm land so they said had to be taxed I do plow and disk alittle on friends farm how much land do you need to own to be farm tax exempt? a little confused thanks Howard
Click to expand...

IDK, I use all of my tractors to farm and I always pay sales tax on the parts. I even have to pay sales tax on diesel. The only thing that is tax exempt here is fertilizer, feed and chemicals and I have to have a tax exempt number for that. It probably depends on each state.
 
the John Deere dealer was in Illinois when I was younger I raised hogs I rented few acres with house I didn't
have to pay tax for anything related to that just said for what ever i bought that it was for farm use signed a
paper and no tax charged still didn't farm any land thanks for any thoughts Howard
 
In Michigan,there's a tax exempt form that you have to fill out with the businesses that you buy farm inputs from. No tax exempt form,no tax exempt. Get caught trying to use that exemption for things that aren't for farm inputs,well,I never tried,but I wouldn't want to get caught to find out what the penalty would be.
 
Everybody pays sales tax in AZ. Farmers, churches, even AZ state agencies have to pay sales tax back to the state on whatever the agency buys - large or small.
 
You have to fill out and file a tax exempt certificate with most vendors to get an exemption.

I then file schedule F for my farm on my taxes.
 
In NYS just about everything I buy for the farm is exempt from sales tax. It's not the machine, nor the land, but the farmer, which is exempt. Do you file Fed. sch. F(1040) ?
 
Brush hogs and skid steers are not tax exempt in Indiana. That may be federal not sure but I got mail on and audit for it. They are not used for the direct productions of ag goods for sale. I said I am required to mow my set aside and they said what's that? That's what u get when city people try to audit farms. Was required to bring in pics of all my equipment because they drove to my house and there was no barns or tractors there! That was a fun 2 weeks!
 
I have a farm in Indiana and my farm tax number is my social security number.
 
D beatty,
You got me thinking before I had my second cup of coffee. I'm not a farmer, retired, but have a rental business and pay taxes. Way too much taxes I might add.

When I make a repair, I keep records and send them to my cpa. He then decides how to write it off my taxes. I think he said most repairs can be written off the same year.

My question is what's the big deal about tax exempt? I pay sales tax on everything and that is taken off my income taxes along with the repair item.

So lets say I make a $1000 repair and pay $70 sales tax. So I wire off $1070 off income tax instead of $1000. My top income is taxed at 25% fed, 3.4% Indiana(I think), 1% county. So almost 30% off the $70 sales tax. Am I right? In the grand scheme, are we talking pennies here?

geo
 
The difference is paying the cpa. I have rentals too and it cost me more to do the taxes on the rental than the farm,more form on the rental. The good thing is I can write off the cpa bill.
 
(quoted from post at 16:45:11 09/08/16) howard parker- Just give them the name of a BTO in your area and pay cash. Problem solved! LOL!
Click to expand...

Yeah sure. Like they would believe the BTO would pay cash. They would probably call the cops on you.
 
4520bw,
I think everyone that is in business SHOULD HAVE A CPA. Get the IRS after you, penalty and back interest alone is a killer.

I've used a CPA all my life and sleep well knowing he knows his business.

I have computer records on spreadsheet going back 20 years. I print out everything the way he wants it, show all the totals of expenditures and income, so it saves him time.

My CPA is very cheap.

Never been red flagged by IRS either.
geo.
 
Get yourself a pair of bib overalls and a farm cap. They always just look at me, have me sign the little slip on the sales reciept saying I am farm exempt and that is that.

This is in MO. Every state is different I suspect.

The farm and home stores have a registry built in their computer system. All you do is tell em you farm, and they put you in the system. No proof asked for.

Each store does if differently on different poducts though. Some wont take the tax off on hobby type stuff, chicken feed, horse stuff, etc. Kinda depends.

Gene
 
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