How to Get Your Farm Tax-Exempt Number

Fertilizer, seed and other products directly used for agriculture qualify for sales tax exemption.
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If you run a commercial farm operation, it's likely your state offers a sales tax exemption for the purchase of goods necessary to run your agricultural business. Exactly how much farm-related income you must earn and what types of agricultural production qualify for the exemption varies by state law. For example, equine boarding might qualify you for the exemption in one state, but not be considered an agricultural use in another.


How to Qualify

To find out if you qualify for a state agricultural sales tax exemption, contact your county agricultural extension agent. You can also visit your state's department of agriculture or revenue department website. If you qualify, you must fill out forms documenting your agricultural income for the previous year, as well as the nature of the business. Depending on the state, you will receive an agricultural exemption number to use when buying acceptable products. In other states, such as Ohio, you must fill out an exemption form to give the retailer with every purchase.


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Separate Farming Entities

If your farming business operates under different business entities, you likely will require a separate number or exemption certificate for each one. If you operate a farming enterprise under different LLCs, for example, you couldn't use the sales tax number for your dairy business and charge items necessary for your greenhouse facility.