If the land has multiple owners, each individual (or married couple) who would like to receive a tax credit must apply separately. The tax credit will be based on the percentage of the asset that each person owns. For example: If three siblings equally own and are selling a $600,000 farm, they would receive a tax credit equal to 8% or 12% of their $200,000 share = $16,000 or $24,000 each.
If the land is owned by an entity (partnership, S. Corp, LLC, trust), the entity should submit one application.
Beginning farmers must apply every year to confirm their eligibility. Asset owners must apply every year for 1-year leases and sales. If an asset owner is applying with a multi-year lease, they only need to apply every three years or sooner if the lease ends or is modified.
Yes. Funding for this program is first-come, first-served, so we encourage applicants to apply as soon as they are prepared with a purchase agreement or lease.
No. You must apply for the tax credit before the stated deadlines in the year your sale or lease took place. If your sale takes place in November or December after our deadline, we recommend applying before the sale with a purchase agreement or holding your sale until January and applying in the new year.
If the land has multiple owners, each individual (or married couple) who would like to receive a tax credit must apply separately. The tax credit will be based on the percentage of the asset that each person owns. For example: If three siblings equally own and are selling a $600,000 farm, they would receive a tax credit equal to 8% or 12% of their $200,000 share = $16,000 or $24,000 each.
If the land is owned by an entity (partnership, S. Corp, LLC, trust), the entity should submit one application.
Tax Credits
Applications
Eligibility
Yes, asset owners are eligible for the tax credit if they are selling their farm with a 1031 Exchange.
Yes, asset owners are eligible for the tax credit if they are selling their farm with a 1031 Exchange.
No. According to the state law for this program, an eligible asset owner is, “an individual, trust, or pass-through entity that is the owner in fee of agricultural land or has legal title to any other agricultural land.” A C-Corporation is not a “pass-through” entity as described in the law.
No. According to the state law for this program, an eligible asset owner is, “an individual, trust, or pass-through entity that is the owner in fee of agricultural land or has legal title to any other agricultural land.” A C-Corporation is not a “pass-through” entity as described in the law.
Asset Owners - No. An asset owner can apply for the maximum tax credits for either a rental or a sale for each eligible beginning farmer each year. There is no lifetime limit, and they can continue to apply for the program as long as the beginning farmer they work with is eligible.
Beginning Farmers - Yes. Beginning farmers are only eligible for the FBM tuition reimbursement tax credit for three years. However, beginning farmers can continue to apply for the program with their asset owners for all 10 years that they are considered a beginning farmer (they just won't get an FBM tax credit for years 4-10).
