No tax for farm use???

[AndyMA]

In Conn to receive a sales tax exemption you must actually be in the framing business (nurseries, actual farming etc count. boarding horses count, renting out land to others to keep horses on does not exempt you,) You are required to have either net income or expenses of greater than $2500 in the previous year and to submit a copy of the Farm Income /Loss IRS form to the state. A dealer cannot just exempt you , you must have a certificate from the state. Falsifing the documents to get the exemption sounds like as federal crime to me......

Andy

 

[LBrown59]

1*You are required to have either net income or expenses of greater than $2500 in the previous year and to submit
2*Falsifing the documents to get the exemption sounds like as federal crime to me......
Andy
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1*Makes a lot of sense; You don't pay tax if you make money but you do pay tax if you don't make money.
2*State taxes are not a federal matter.

 

[LBrown59]

</font><font color="blue" class="small">( <font color="blue">"I could have also bought tax free if I had kept my vendors license." </font>

You could have bought it tax free with a vendor's license, for resale purposes. However, if you converted it from a resale product to a personal use item, in other words if you used it, you would owe the same tax you would have paid without the vendor's license. Any time a vendor takes anything out of inventory for use, either personal or for use in the business, the tax is owed as if it had been purchased without the vendor's license.
)</font>

Any time a vendor takes anything out of inventory for use in the business, the tax is owed as if it had been purchased without the vendor's license.
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But then the Tax is deductible on state and fed income taxes and you can also claim depreciation.
So basically you not only get to deduct the sales tax you get to deduct the purchase price also.

 

[AndyMA]

</font><font color="blueclass=small">( 2*State taxes are not a federal matter. )</font>

The state tax part is clearly not a federal crime. The federal crime is falsifing the federal income tax form showing your farm income/losses.

Andy

 

[GaryBDavis]

Check with your state comptroller's office. They usually have a web site where you can look up the sales tax exemption rules yourself. You can then call them, talk to a sales tax specialist and verify what you interpret. That's what I did. The farm use sales tax exemption rules vary from state to state.