Bookkeeping and taxes for farms and ranches
Farm income is seasonal, equipment is expensive and the tax rules are their own world. We keep your books through the whole cycle, handle crop insurance and USDA payments correctly and prepare Schedule F or your entity return, using the farmer estimate rules.
Where do farm books get tangled?
One account, a household and a farm running through it, and a shoebox in March.
Farm and household mixed
We separate the operation from personal spending so deductions hold up.
Program payments and insurance
USDA, crop insurance and disaster payments each have their own timing.
Equipment without a plan
A big purchase in a good year can be smart or wasteful. With 100% bonus depreciation back, we plan it with you.
How do we set up farm books?
By crop, herd or enterprise when your operation needs it.
| Section | Accounts |
|---|---|
| Income | Crop and livestock sales, program payments, crop insurance, custom hire |
| Expenses | Seed, fertilizer, chemicals, feed, fuel, repairs, custom hire, labor, land rent |
| Balance sheet | Machinery, breeding livestock, land, operating and equipment loans |
- Two-thirds of income from farming means one estimate by January 15, or file and pay by March 1
- Schedule J income averaging over the three prior years
- Crop insurance often reportable the following year
- Off-highway fuel tax claimed back on Form 4136
- Farmworkers reported on Form 943 by January 31
- Many states let producers buy production items without sales tax, with the right registration
What's your break-even before you sell?
Measured by crop, herd or enterprise.
Cost per acre
Seed, fertilizer, chemicals, fuel and labor.
Break-even price
Per bushel, head or pound.
Equipment cost per acre
Depreciation, repairs and interest on machinery.
Working capital
What carries you from planting to harvest.
Debt coverage
Cash from operations against loan payments.
Enterprise margin
Profit by crop or livestock line.
Farmers and ranchers ask us.
Ask anything else on a free 30-minute call.
Book a callSources: IRS Publication 225, Form 943
Free tools: Mileage calculator, Small business deductions, Record retention schedule
Do you work with farms in my state?
Yes. We work fully online with farms and ranches in any state, and handle each state's returns.
We also rent out some land. How is that reported?
Cash rent usually goes on Schedule E, not Schedule F. Crop-share rent goes on Form 4835 if you don't materially participate in the farming.
Is my small farm a business or a hobby?
It depends on whether you run it to make a profit, which the IRS judges from how you operate. Hobby losses can't be deducted, so we go through the factors with you.
Tell us what's messy. We'll tell you what it takes.
Tell us what you need and get a fixed price before any work starts. No pressure and no contract.