Farm Tax Resources

• September 22, 2010
• Paul Neiffer

A reader asked me for any books that I would recommend regarding farm taxes.  As a CPA, there are several courses around the US that I can attend to get my continuing education and these courses do provide workbooks for us as CPAs.  However, they are not designed for reading by a farmer since they are more in a outline format.

I have researched this on the Internet and have found a couple of small booklets on the subject that I think can help farmers.  You do need to make sure that these resources are updated each year since the tax law does change and lately, it changes rapidly.  Two that I find helpful are:

1. University of Minnesota Extension has a “Ag Income Tax Update for Farm Families“.  This gives a good overview of farm taxation including some Minnesota specific data.
2. North Dakota Extension Service has a good guide on tax records retention labeled “What to Keep Where and For How Long”
3. Washington State University prepared a “Federal Income Tax Management for Farmers and Ranchers” guide back in October, 1995.  Although this is outdated, the actual guide has very good income tax planning principles that will not get outdated.
4. Another slightly outdated manual was prepared by Purdue University titled “Income Tax Management for Farmers in 2008“.

Finally, the old standby is Publication 225 from the IRS – “Farmer’s Tax Guide”.  This is a very comprehensive outline of farm taxation from the IRS standpoint.  It does a great job of explaining the tax law, but you will not find any tax planning or strategies in this guide, but you need to be able to use it.

There are a couple of out of print books that you may be able to find on Amazon or the net.  The  first book is “Farm Estate and Business Planning” by Neil Harl, long-time instructor at Iowa State University.  I have the 1994 version in my library and I think the last time it was updated was 2001.  As the title indicates, this is primarily a book on tax and estate planning for farm families and does a great job on that subject.  You will not find much current income tax planning in this book.

Another book is Ag Executive’s Tax Guide for Farmers and Ranchers by Davenport and Dunteman.   This book was published in 1993, so a lot of the material is outdated, but a lot of planning topics are still pertinent.

Some of the paid marketing services such as Pro Farmer, DTN, and others have several income tax related sections and most of these are quite good and are updated at least annually.

My personal goal assuming I find the time is to come up with my own “Farmers Tax Guide” and post it on my site and keep it updated at least annually.  With the personal extensions almost done, this will give me about 3 months to get it done before tax season.

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