I received a taxable grant from NRCS to install a prairie on unused land. I claimed the income as instructed, but can I claim expenses incurred in installing the prairie?

[renakilgore]

It's a 40 acre field adjacent to our home that at one time was a brome field.  We never made any income off of the land since we owned it.  I spent most of the grant money to pay for herbicide and seeding.  

[ToddL · Accepted solution]

If you were paid to create a prairie ("open space"?), you can deduct the costs you incurred to do that.

Enter the expenses (e.g. "Land clearing costs") as a negative amount in "Other Income" on Line 21.

To enter the negative figure:

• Go back to Less Common Income, Miscellaneous Income and Other reportable income.
• Continue to the screen Other Taxable Income. Enter the description (e.g. Land clearing costs), and a negative amount.

See the attached sample screenshot of a "negative" entry on Line 21.