how many cows do you need to have to get a tax break? - Homesteading Today
Homesteading Today

Go Back   Homesteading Today > Livestock Forums > Cattle

Cattle For Those Who Like To Have A Cow.


Reply
 
LinkBack Thread Tools Rate Thread
  #1  
Old 03/22/11, 08:22 AM
Registered Users
 
Join Date: Feb 2011
Location: VA
Posts: 22
how many cows do you need to have to get a tax break?

just wondering. we rent a house on ten acres and we wanted to get cows, i wanted to get a milk cow and then a meat cow or two.. but out landlord lends a lot of the big field already to someonefor their cows. so how many would we have to have on it so she could still get the tax refund or brake or whatever it is that she would get?

__________________
Reply With Quote
  #2  
Old 03/22/11, 08:43 AM
linn's Avatar
 
Join Date: Jul 2005
Posts: 3,441

You are not going to get much investment credit on a milk cow and none on a beef . Farmers are allowed to take investment credit on breeding animals if they pay income tax on the increase sold from these animals. I don't think you will be able to carry very many cows on ten acres, maybe four adult cattle.
If you are asking how many acres is considered a farm for filing for farm income you will have to check with your income tax preparer. I think this is more determined on the fact that you intend to make a profit and pay income tax on your profit from the farm.


http://www.ehow.com/about_5437771_pa...eductions.html

__________________
Visit the Christian Homesteader
http://farmwoman.proboards.com/index.cgi

Last edited by linn; 03/22/11 at 08:53 AM.
Reply With Quote
  #3  
Old 03/22/11, 08:58 AM
ksfarmer's Avatar
Retired Kansas farmer
 
Join Date: Apr 2007
Location: north-central Kansas
Posts: 2,703

Not sure what you are asking, but, I never heard of a "tax break" for owning cows. As Linn says you can get investment credit and depreciation on breeding stock, and there is a difference when you sell if it is raised cow or purchased. There ain't no "tax break" for simply owning some cows that I ever found.

__________________

* I'm supposed to respect my elders, but its getting harder and harder for me to find one. .*-

Reply With Quote
  #4  
Old 03/22/11, 09:17 AM
springvalley's Avatar
Family Jersey Dairy
 
Join Date: Jun 2009
Location: Illinois
Posts: 4,769

As some have said allready, a milk cow or one beef will be nothing more than a benifit for you. You will have to have several cows or cattle to have an income to become a working farm and recieve a tax break for being a farm and not just a home. You also need to make a profit in three years or you just have a hobby and then not really a farm. That will be the only tax break you will get is going from a residence were you live to being a livestock farm. You may even have to be rezoned depending on where you live. But the best thing is to talk to a GOOD agriculture tax man. Good Luck, > Marc

__________________

Our Diversified Stock Portfolio: cows and calves, alpacas, horses, pigs, chickens, goats, sheep, cats ... and a couple of dogs...
http://springvalleyfarm.4mg.com

Reply With Quote
  #5  
Old 03/22/11, 09:36 AM
 
Join Date: Jun 2003
Location: About 35 Miles S. of Tulsa
Posts: 3,030

The "tax break" in Oklahoma is that you pay no sales tax on feed and supplies used on a farm. In order to qualify you must have a farm tax number, for which you apply. To get one you must file the agriculture income tax forms with the state and IRS.

I've read in the past couple of years that some tax assessors are contesting the farm exemption where the farms are very small, and one fellow told me that he did not apply in his county because he was told that there was a 5 cow minimum for cattle raisers.

I suspect that this varies around the country. I've also been told that the IRS has never challenged a small farmer's losses where the losses were small in relation to the income. In short, small farmers can report small losses almost forever. This I would not guarantee--my goal is profit. I'm satisfied with small losses if they are caused by depreciation on new equipment.

__________________
Reply With Quote
  #6  
Old 03/22/11, 09:39 AM
sammyd's Avatar  
Join Date: Mar 2007
Location: Central WI
Posts: 4,985

If you sell over 1000 dollars from your place you may file a schedule F on your federal taxes and then you may write off certain items that count as farm expenses.
Their is no rule about making a profit every so often but if you don't and you get audited you had better be able to show that you were actually trying to make the farm work as a farm, not just a hobby.
You would be well served to contact a CPA and find out if they have any experience with farms. They may cost some to get the taxes done but we have found the money to be well spent.
Certain states have different rules as to how your property taxes work. Some have acreage limits, some don't there again, a CPA will know the rules.

__________________

Deja Moo; The feeling I've heard this bull before.

Reply With Quote
  #7  
Old 03/22/11, 11:26 AM
spinandslide's Avatar  
Join Date: Jun 2008
Location: northwest Texas
Posts: 655

Sounds like a good time to talk to an accountant who specializes in ag..
mine does and he is invaluable on answering questions or helping me understand our laws.

__________________
Reply With Quote
  #8  
Old 03/22/11, 07:38 PM
francismilker's Avatar
Udderly Happy!
 
Join Date: Jan 2006
Location: Oklahoma
Posts: 2,766
Quote:
Originally Posted by Oxankle View Post
The "tax break" in Oklahoma is that you pay no sales tax on feed and supplies used on a farm. In order to qualify you must have a farm tax number, for which you apply. To get one you must file the agriculture income tax forms with the state and IRS.

I've read in the past couple of years that some tax assessors are contesting the farm exemption where the farms are very small, and one fellow told me that he did not apply in his county because he was told that there was a 5 cow minimum for cattle raisers.

I suspect that this varies around the country. I've also been told that the IRS has never challenged a small farmer's losses where the losses were small in relation to the income. In short, small farmers can report small losses almost forever. This I would not guarantee--my goal is profit. I'm satisfied with small losses if they are caused by depreciation on new equipment.
Great post Ox! I've been doing this for years now and am also seeing the number of Tax ID cards being issued diminish.
__________________

Francismilker

"The effectual fervent prayer of a righteous man availeth much" James 5:16

Reply With Quote
  #9  
Old 03/22/11, 08:33 PM
 
Join Date: May 2003
Location: Zone 7
Posts: 10,285

I see you are in Virginia. Whether a deferral for farm use or forestry is allowed in Virginia the state gives the approval to each county to make the decision. Brunswick county Virginia is for certain one county that does not offer that choice to land owners.

__________________

Agmantoo
If they can do it,
you know you can!

Reply With Quote
  #10  
Old 03/22/11, 11:41 PM
 
Join Date: Apr 2010
Location: Lisbon,Ohio
Posts: 832

I think he's talking about the CAUV (current agricultural use value) .
It's a tax brak on real estate taxes.
Her in Ohio if it's under 10 acres (house and yard does not count) you have to show proof of at least $2500 gross income from farmin. 10 or more no proof is needed.
Chris

__________________
Reply With Quote
Reply



Thread Tools
Rate This Thread
Rate This Thread:

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On



All times are GMT -5. The time now is 11:36 PM.