FARMERS
Farming income does not arrive on a steady schedule, and farm taxes do not work like anyone else’s. PFG Tax does bookkeeping for farmers and ranchers built around the way agriculture actually runs, from seasonal cash flow to the difference between an expense and a depreciable asset. We keep your books accurate year round so you are ready at tax time and not caught off guard. Call (888) 882-7393 to talk with someone who understands farm finances.
A farm is a business with its own rules, its own tax form, and its own rhythm. Income comes in waves tied to harvest, livestock sales, or commodity prices, while expenses run all year long. On top of that, the tax treatment of what you spend money on depends heavily on what you bought. Get that part wrong and you either miss deductions or set yourself up for trouble. We build your books to handle all of it.
Knowing the difference between an expense and an asset
This is where a lot of farm bookkeeping goes sideways. Some of what you spend is an operating expense you deduct in the year you pay it, such as seed, feed, fuel, fertilizer, and repairs. Other purchases are capital assets that have to be depreciated over time, such as equipment, machinery, farm buildings, and certain breeding livestock. There are also rules that can let you write off more of an asset up front in the right circumstances. Classifying each purchase correctly affects your taxable income every single year, and we set your books up so the line between expenses and depreciable assets is clear and handled the right way.
Capital gains and selling farm property
Selling off land, equipment, or livestock is not the same as ordinary farm income, and it is not taxed the same way. The sale of certain farm assets can be treated as a capital gain, which is taxed differently from the income you earn selling crops or product. Tracking your cost in those assets and recording sales properly is what makes the difference between a clean return and an expensive surprise. We keep those records straight so when you sell, you and your tax preparer know exactly what you are working with.
Built for a business that runs on seasons
Farming cash flow is lumpy. You might go months spending money before a harvest or a sale brings income in. Books that ignore that timing are not much help. We keep your records current through the whole year, so during the slow months you can see what you have, plan for what is coming, and make decisions with real numbers instead of waiting until the end of the year to find out where you stand.
What we handle for farms and ranches
- Clear separation of deductible expenses and depreciable capital assets
- Depreciation tracking on equipment, machinery, buildings, and breeding livestock
- Capital gains recordkeeping on the sale of land, equipment, and livestock
- Seasonal income and expense tracking that fits farm cash flow
- Schedule F recordkeeping and books ready for farm tax preparation
- Crop, livestock, and commodity income tracking
- Monthly bookkeeping, reconciliation, and financial statements
- Catch-up and cleanup bookkeeping, plus records ready for lenders and tax filing
For the people who actually work the land
Whether you run row crops, livestock, a dairy, or a mixed operation, you have enough to manage without fighting your books. We handle the financial side with an understanding of how farms earn, spend, and get taxed, so your records are accurate, your deductions are captured, and you are ready when tax season comes.
FAQ
What is the difference between a farm expense and a depreciable asset?
An operating expense is something you use up in the course of the year and deduct that year, like seed, feed, fuel, and fertilizer. A depreciable asset is a longer-lasting purchase like equipment, machinery, a building, or breeding livestock, and its cost is written off over a number of years instead of all at once. Classifying each purchase correctly affects your taxable income every year, which is why we keep that line clear in your books.
How are capital gains handled when I sell farm property?
Selling land, equipment, or livestock is often treated differently from the income you earn selling crops or product, and certain sales can qualify for capital gains treatment, which is taxed at different rates than ordinary income. We track your cost in those assets and record the sales properly so the gain is reported correctly and there are no surprises.
Can your bookkeeping handle seasonal farm income?
Yes. We build your books around the reality that farm income comes in waves while expenses run all year. We keep your records current through the season so you always know where you stand and can plan around the timing of your income.
Do you prepare books for Schedule F?
Yes. We keep your records organized in a way that lines up with how farm income and expenses are reported, so your books are ready for farm tax preparation with no last minute cleanup.
What types of farms and ranches do you work with?
We work with row crop farms, livestock and cattle operations, dairies, and mixed operations. The bookkeeping is set up around how your specific operation earns and spends.
