Ag versus Wildlife exemption

[suburbanfarmer]

It likely varies from state to state, but read the fine print.
You may have to show an average gross sales of $xx to qualify for an ag exemption, among other qualifications (acreage, etc..).

In NY, having an ag exemption also has benefits when it comes to registering vehicles that don't require annual inspections (but are limited in use).

Interested in learning this more for NY. Do you have any links? Google search didnt point me anywhere.

 

[txdon]

so there is a sales tax exemption and a property tax exemption evidently. Is there anything else? Thanks

Do you have your Texas Agriculture or Timber Registration card from the state? You will need this card to license a farm trailer and to be on file at retail stores such as Tractor Supply. The license fee is less for a trailer used for farm purposes. You also need the card for you farm license for your vehicle but it is very restrictive in use. You might want to check with the county tax assessors office to see how many goats you need and any other requirement. If you have a business with the goats and can make money you can deduct the expenses as farming business expenses but some years you will have to show a profit or risk being audited.

 

[3Ts]

Do you have your Texas Agriculture or Timber Registration card from the state? You will need this card to license a farm trailer and to be on file at retail stores such as Tractor Supply. The license fee is less for a trailer used for farm purposes. You also need the card for you farm license for your vehicle but it is very restrictive in use. You might want to check with the county tax assessors office to see how many goats you need and any other requirement. If you have a business with the goats and can make money you can deduct the expenses as farming business expenses but some years you will have to show a profit or risk being audited.

Farm trailers under 4,000# don't get inspected - not sure if this is all trailers under 4k.
The vehicle licensed as a farm truck (cars don't qualify) has to stay within 150 miles of home (as the crow flies), but can go beyond that for 2 weeks out of the year.
And you do have to operate it as a real business. If you lose the tax exemption the taxes are retroactive for 5 years. Some things for the farm are tax exempt and some are not. Typically, maintenance things are tax exempt, but check the list which should be on the form you file for your card.
I assume the seller has a current tax exemption. When he sells and you buy, if you don't plan on keeping the tax exemption, you better know who is paying the 5 years worth of taxes which will have to be noted in the sales agreement or you'll be paying them.

 

[CobyRupert]

Interested in learning this more for NY. Do you have any links? Google search didnt point me anywhere.

I haven't researched much on Ag exemptions for sales tax purposes, but did for (farm) vehicle registrations and vehicle inspection "loophole". See link:
Laws of New York

Basically:
Vehicle & Traffic Law (VAT),
Article 301: All vehicles require inspection. ..but:
Article 308.3 : Definition of vehicle does not include Farm Vehicles registered as per Article 401.13.
Article 401.13: Defines limitations of "farm vehicle registrations." Defines a "farm" as the same as defined in Section 301 of Agricultural and Markets Law (AGM), except farmers with sales of at least $1000 are eligible (vs. the typical $10,000 sales that meet definition of "farm" in AGM laws (below)).

Agricultural & Markets (AGM):
Article 301: Definitions: Defines farms, crops, &
land used in agricultural production.
"Land used in agricultural production": Not less than seven acres of of land used as a single operation in the preceding two years for
the production for sale of crops, livestock or livestock products of an
average gross sales value of ten thousand dollars or more; or, not less
than seven acres of land used in the preceding two years to support a
commercial horse boarding operation or a commercial equine operation
with annual gross receipts of ten thousand dollars or more. Land used in
agricultural production shall not include land or portions thereof used
for processing or retail merchandising of such crops, livestock or
livestock products. Land used in agricultural production shall also
include:
a. Rented land which otherwise satisfies the requirements for
eligibility for an agricultural assessment.
etc...etc...

 

[skipperbrown]

Your best bet is to link up with a CPA who is well versed in ag businesses. This is going to be a small subset of CPAs as most focus their practices on state and federal income taxes, not property and sales taxes and least of all, agriculture. However, there will be CPAs who focus on this segment. Call around and find one. You should be able to buy an hour of time for less than $250 and it will be money very well spent.

 

[CobyRupert]

Your best bet is to link up with a CPA who is well versed in ag businesses. This is going to be a small subset of CPAs as most focus their practices on state and federal income taxes, not property and sales taxes and least of all, agriculture. However, there will be CPAs who focus on this segment. Call around and find one. You should be able to buy an hour of time for less than $250 and it will be money very well spent.

Example: Farm Credit (East) has a 104 year history of loans, tax and financial planning service to the Ag Industry. They have a branch in Batavia and other Western NY locations. I've never used them for loans, but have used the local branch for tax prep services (and some planning advice along those lines).

 

[fishheadbob]

Interested in learning this more for NY. Do you have any links? Google search didnt point me anywhere.

In New York there is a partial property tax exemption which kicks in if you have gross sales of $10,000 or higher. If you are on smaller acreage the amount is higher. The best place to check on this is your local assessor, that's who explained it well to me. There are exclusions and requirements that take a lot of reading to decipher.
The sales tax exemption requirements are found on the state tax site. Best info is probably on the sales tax exemption form itself, and the guidlines on the NY tax site. Use their search engine, but again, a lot of reading is recommended. Essentially it all boils down to you have to be farming with a profit motive rather than growing a bushel of zuchinni in hopes of gaming the system. The IRS works under the same presumption.

 

[suburbanfarmer]

Thanks guys, I am going to research this more as I have 15 acres and want to start an organic orchard and quail farm

 

[lostcreekranch]

so there is a sales tax exemption and a property tax exemption evidently. Is there anything else? Thanks

What you're looking at is an "agricultural tax valuation" vs. a "wildlife tax valuation". Tax "exemption" has nothing to do with this. It's a determination of how your property is evaluated regarding your property taxes.

I'm guessing you're in Leon County? I would suggest you make an appointment and go have a sit down with your Chief Appraiser at the Leon County Appraisal District in Centerville. He'll be ably to give you accurate information regarding your situation and how the property has been historically evaluated.

Leon County Appraisal District

 

[Molalla1]

Marquez, Texas.

Update your sig . . .