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New Member
posted May 31, 2019 4:34:40 PM

I have a farm as a LLC that I need to shut down. I have $30k in debt from a USDA farm loan. What do I need to do on my taxes? Can I carry the debt forward?

How do i indicate my farm is shut down but still claim losses in the future?

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1 Best answer
Alumni
May 31, 2019 4:34:41 PM

They were loans to buy trucks, tractors green houses etc.

Loans themselves rarely result in income or deductions.  For example, if the farm was still in business you would not deduct the repayments.

If the farm is out of business you may have some loss on abandonment of trucks, tractors, greenhouses, etc. but I would work with a local tax professional to determine that, as it can be complicated.  Merely paying back the loans by themselves is not a deduction.


7 Replies
Alumni
May 31, 2019 4:34:41 PM

They were loans to buy trucks, tractors green houses etc.

Loans themselves rarely result in income or deductions.  For example, if the farm was still in business you would not deduct the repayments.

If the farm is out of business you may have some loss on abandonment of trucks, tractors, greenhouses, etc. but I would work with a local tax professional to determine that, as it can be complicated.  Merely paying back the loans by themselves is not a deduction.


New Member
May 31, 2019 4:34:43 PM

Awesome!  Thanks!!

Alumni
May 31, 2019 4:34:47 PM

Much of the answer to your question depends on what the debt was for.  For example, if the loans were incurred for (and proceeds expended for) deductible items such as feed and fertilizer, and you deducted them when purchased, you can't deduct them again when you pay the loan back.


What were the loans for?

New Member
May 31, 2019 4:34:48 PM

They were loans to buy trucks, tractors green houses etc.

New Member
May 31, 2019 4:34:49 PM

The farm is essentially bankrupt

New Member
May 31, 2019 4:34:51 PM

I still have to pay the loans back so I don't know how to incorporate that into my taxes

Alumni
May 31, 2019 4:34:52 PM

Did you include the loan as income when you received it?