What is a Farmer’s Tax Return Due Date?
In response to our blog post from yesterday, we had a reader make the following comment:
“Good morning Paul, I am a farmer in Iowa and unless I am wrong farmers must file their taxes by March 1st and wage earners by April 15. I don’t understand why there is a different due date for these two groups. Can you please explain this to me?”
This is a good question that can be confusing for most farmers. There is only one due for all individuals and that is April 15 (however, if you are overseas it can be later and some individual do not file on a calendar year basis). Farmer’s due date is April 15; however, if they file AND pay by March 1 they are not required to make any estimated income tax payment on January 15.
This is why this is mistakenly called the Farmer’s due date. It is only a due date to get out of any estimated tax underpayment penalty. All other income tax related due dates such as IRA contributions, pension plan contributions, etc. remain April 15.
As we have mentioned in many posts before, most farmers should consider not filing by March 1 and simply make an estimated tax payment on January 15. In most cases, they will be better off economically and emotionally since trying to get a complicated farmer’s tax return done by March 1 is getting more impossible every year.
Also, Treasury Secretary Mnuchin formally announced today that they are planning on some type of extension of the April 15 due date. However, there are no firm details yet. We will keep you posted.
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a principal with CliftonLarsonAllen in Walla Walla, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. Paul and his wife purchase an 180 acre ranch in 2016 and enjoy keeping it full of animals.
Paul,
Can you please clarify? If a 2/3 farmer chooses to pay by 4/15 with penalty in a “normal year,” is he still eligible for the 7/15 payment date with no additional penalty other than what was calculated to 4/15?