An agricultural machine or trailer is exempt from motor vehicle sales and use tax if it is used at least 80% of the time in one of the following ways: Although the legal provisions relating to exemptions from agricultural sales and use tax have not changed, the new obligation under the tax identification number ensures that only those who have prequalified at DOR can benefit from these exemptions. Motor Vehicle Tax Exemption – To claim the gross rental income exemption for the rental of qualified agricultural machinery/timber and qualified agricultural/timber trailers, enter your agricultural and timber registration number (Ag/timber number) and expiry date on Form 14-305, Motor Vehicle Rental Tax Exemption Certificate (PDF) that you give to the car rental company. Farm Plates – For more information about registering (or renewing) a motor vehicle with agricultural license plates, contact your local collector accountant or the Texas Department of Motor Vehicles in TxDMV.gov. However, there are three ways to buy items without paying sales tax. Some items are exempt by law, others are exempt if used exclusively for agricultural/forestry purposes, and other items may qualify for a standard VAT exemption. To be eligible for the exemption, the Sales and Use Tax Exemption Certificate must clearly indicate that the feed is intended for workhorses, animals intended for sale in the course of normal commercial activities, or breeding animals for animals sold. A new Kentucky law requires farmers to apply for an agricultural exemption number to make eligible purchases for the farm that are exempt from sales tax. The deadline to apply for the new Farm Exemption Number for current farmers is January 1, 2022. Application form 51A800 is currently available on the Department of Finance website here: revenue.ky.gov/Forms/51A800%20(4-21)_fill-in.pdf. Sellers must keep a copy of any of these documents on file and include the name, address, and description of the buyer`s exempt purchases on each invoice. Farmers, nurseries and loggers should keep their original documents in a safe place so that they can be used later in the exemption period. Items that are exempt from sales and use tax when sold to persons holding an agricultural sales and use tax exemption certificate include: Retailers are not required to accept an exemption certificate.
If they choose not to accept an exemption certificate from you for an eligible item, you will have to pay the tax and then claim a refund of the tax paid by the auditor. No action is required on behalf of the current exemption holders unless you have changed your address or no longer meet the exemption requirements (a list of these requirements can be found in the certificate application). If your mailing address has changed, please log in to your TNTAP account and change your address. If you no longer meet the requirements of the agricultural exemption, please notify the Department by calling us at 615-253-0600. All flat-rate exemption certificates issued to retailers for eligible agricultural and wood products must be updated every four years with the expiry date of your current Ag/Timber number. For a detailed publication of the questions and answers on farm tax issues issued by the Department of Tax Services, see: Forms 51A158 and 51A159 both list specific items eligible for exemption from sales tax on the purchase of farm articles. For more information about exempt purchases, see Kentucky Revised Statutes (KRS) 139.480. For example, if three family members operate a farm, one member can apply for an Ag/Timber number for the farm, and all three family members can use it when purchasing eligible items. Or a farm or forestry operation with multiple employees may receive a card and number that can be used by all authorized employees for qualified purchases.
Farm trailer – a trailer or semi-trailer designed and used primarily for a farm or ranch. The agricultural exemption number does not exempt purchases from VAT. It must be used with Form 51A158 Agricultural Exemption Certificate for Farm Purchases and Machinery and with Form 51A159 Exemption Certificate for Materials, Machinery and Equipment for the Construction of Agricultural Facilities. These certificates must be presented to each supplier or supplier with the letter DOR. Farm and forestry numbers must be renewed every four years, regardless of when the number was first assigned. Renewed and new Ag/Timber numbers expire on December 31, 2023. Every four years, the Department of Finance reissues all current holders of the agricultural exemption. Renewed certificates will be sent in the second half of December before the expiry date of the certificate (certificates for the current period expire on December 31, 2023). The new certificates enter into force on 1 January of the following year and expire four years later, on 31 December. You cannot buy gasoline tax-free; However, you can claim a refund (PDF) of the tax paid on gasoline used in off-road equipment such as tractors, lawn mowers and generators. If you are a farmer, rancher or timber producer who carries out one of the activities listed below, you are entitled to a tax exemption for the purchase of certain items used to manufacture your agricultural and wood products for sale.
The rearing and harvesting of agricultural or horticultural products, dairy farming, forestry, rearing and poultry or the rearing and harvesting of fish, oysters, clams, bivalve molluscs or other molluscs. Any person who was engaged in a commercial or commercial activity in agricultural production and who had a gross income of $2,500 or more from that agricultural production in the previous taxation year, or on average a gross income of at least $2,500 for the two immediately preceding taxation years. From 1. However, in July 1995, applicants whose gross income from farm production in the previous taxation year was less than $2,500, but who are still eligible for a tax exemption permit issued in the current or immediately preceding taxation year, such a farmer purchased a business or farm business from a vendor who received an exemption permit at the time of purchase. was issued by the tax exemption for farmers. However, if agricultural production is not continued by that purchaser during the period beginning on the date of purchase and ending two years after the date of purchase, the applicant is liable for sales or use tax otherwise due. Gross income from farm production is generally reported on Federal Form 1040, Schedule F or Schedule C of the farmer`s federal income tax return. If you are claiming an exemption from motor vehicle rental gross income tax when you lease eligible farm or wood machinery trailers, you must enter your farm or timber operation number and expiry date on Form 14-305, Motor Vehicle Rental Tax Exemption Certificate (PDF). Once we have processed your request, we will send you a confirmation letter with two courtesy cards with your Ag/Timber number.
These cards are for your convenience. They do not replace the requirement to provide a completed exemption certificate with an active Ag/Timber number and an expiry date for tax-exempt purchases. .