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Can I deduct any expenses I have for agricultural classification ?I had to buy 30 acres to grow alfalfa to feed horses . I also had to build a 40- by 30 ft, shed to store the feed and drill a new well for water

 
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Fern
New Member

Can I deduct any expenses I have for agricultural classification ?I had to buy 30 acres to grow alfalfa to feed horses . I also had to build a 40- by 30 ft, shed to store the feed and drill a new well for water

The purchase of 30 acres is not tax deductible. This is a capital asset, you will keep track of the amount you paid for the land and a gain or loss will be computed when you sell the land.

The costs that you had to grow your alfalfa crop would be deductible.

The 40 by 30 shed is also a capital asset. However, you can depreciated it over it's useful life so you can write off a portion of it every year of it's life

The cost to drill a new well is also a depreciable asset and you will get to write off a portion of it every year of it's life.

You will need to use Turbo Tax Self Employed online or Turbo Tax Home and Business desktop to complete your tax return. Your information will be entered in the Business Tab under Farm Income. The program has step by step instructions for entering each of the above items.

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1 Reply
Fern
New Member

Can I deduct any expenses I have for agricultural classification ?I had to buy 30 acres to grow alfalfa to feed horses . I also had to build a 40- by 30 ft, shed to store the feed and drill a new well for water

The purchase of 30 acres is not tax deductible. This is a capital asset, you will keep track of the amount you paid for the land and a gain or loss will be computed when you sell the land.

The costs that you had to grow your alfalfa crop would be deductible.

The 40 by 30 shed is also a capital asset. However, you can depreciated it over it's useful life so you can write off a portion of it every year of it's life

The cost to drill a new well is also a depreciable asset and you will get to write off a portion of it every year of it's life.

You will need to use Turbo Tax Self Employed online or Turbo Tax Home and Business desktop to complete your tax return. Your information will be entered in the Business Tab under Farm Income. The program has step by step instructions for entering each of the above items.
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