How to Get Your Farm Tax-Exempt Number

Farming is a profitable and lucrative venture for many. According to individual state tax laws, a farmer can apply for a tax exemption number that can be used to purchase farming equipment without having to pay sales tax on the purchase. This tax break is especially beneficial for farmers who have to make costly equipment purchases. Individual states assign tax-exempt numbers to farmers who complete an application and are approved for the benefit.

Instructions

• 1

  Research your state's tax exemption requirements for farmers. Locate the websites or phone numbers of the Department of Revenue or the Department of Agriculture in your state. Contact one of these departments and request application instructions for tax-exempt status.

• 2

  Determine if you qualify for tax-exempt status. Most states provide brief eligibility guidelines for receiving a tax-exempt number for farming purposes. The Department of Revenue or the Department of Agriculture in your state should be able to inform you of the eligibility standards. In most states, an eligible farm should be directly involved in the production of agricultural goods that can be sold. The goods can include crops or livestock. A tax-exempt number will not be provided for farmers who intend to keep the products on the farm for personal use only.

• 3

  Complete the application process. Follow the directions provided by your state for receiving tax-exempt status for farmers. Complete all questions on the application and provide detailed information about the products and services provided by the farm. According to Taxadmin.org, some states do not provide a tax-exempt number but rather issue a tax-exempt certificate. Farmers can use the tax-exempt certificates in the same manner as tax-exempt numbers.