How to Claim a Farming Sales Tax Exemption
If you are a farmer or rancher, you are entitled to take advantage of state tax exemptions for various items that you use for running and maintaining your farm. If you are unaware of such tax breaks, do some research to ensure that your farm qualifies and that you receive the tax exceptions available to you. Here's how to clam a farming sales tax exemption.
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Instructions
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Determine whether or not your farm or ranch qualifies to take a farming sales tax exemption. You can find this information by visiting your state's tax and finance department website.
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Complete the farmer's tax exemption form (also sometimes called a certificate). Each form has its own set of instructions on how to correctly fill in the necessary information to complete the form.
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Present the completed form or certificate every time you purchase a tax exempt item to claim your farming sales tax exemption.
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Retain a copy of your tax exemption certificate on file for later accounting and tax filing purposes.
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Tips & Warnings
In some states, a farm or ranch is defined as land used in whole or in part for the production of livestock, crops or other agricultural products, which are sold as a course of doing business. Not all states have the same definition. Determine whether or not you fall within the definition before attempting to claim a farming sales tax exemption.
Some items such as fertilizers, insecticides, medications animal feed and machinery and equipment used exclusive in the course of doing business or maintaining a farm business are excluded from state taxes. This is not an all encompassing list; understand which items are subject to exemption so that you can take full advantage as an exempt farmer.
