2011 Farmer’s Tax Guides Available at OSU County Extension Offices

by David Marrison, OSU Extension Educator

Do you need a resource to answer those tough farm tax questions? If so, farmers can receive a free copy of IRS Publication 225, the 2011 Farmers Tax Guide, at their local county OSU Extension office. The 2011 Farmer’s Tax Guide is an 89 page publication which explains how the federal tax laws apply to farming. This guide can be used as a guide for farmers to figure taxes and complete their farm tax return.

Some of the new topics for the 2011 tax year which are included in this publication are: standard mileage rate, start-up costs back to $5,000 in 2011, increased section 179 expense deduction dollar limits, special depreciation allowance, self-employed health insurance deduction, lower self-employment tax rates, maximum self-employment net earnings, and new medicare tax rates. More information can be found at the IRS website at: http://www.irs.gov/publications/p225/index.html

Part I of Schedule F (Form 1040) has been revised for 2011, and the line numbers for reporting farm income are not the same as in prior years. The payments reported on lines 1a and 2a for specified sales of resale or raised products are those received through a merchant card or a third-party network. These generally will be reported to the farmer on Form 1099-K, Merchant Card and Third Party Network Payments. Merchant cards include, but are not limited to, Visa® and Master-Card®. Third-party networks include, but are not limited to, Paypal® and Google Check-out®. The IRS instructions for Schedule F (Form 1040) state that merchant card and third-party network transactions are to be reported on line 1a or 2a even if a Form 1099-K is not received. Other sales of commodities are reported on lines 1b and 2b.

The Rural Tax Education Site has an example Schedule F on their web site to help producers as they complete their Schedule F. The sample return can be found on web site at: http://ruraltax.org/

Click here to find the location of the OSU Extension County Extension offices.

Click here to access the 2011 Farmers Tax Guide

Click here to access the Form 1040-Schedule F for 2011

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