SERVICES

Farm Tax
Strategy

Strategic tax planning designed for the unique challenges and opportunities of agricultural operations.

Trusted by farm families across the country

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WHY IT MATTERS

Farm Taxes Don't Work
Like Other Businesses

Farm tax is fundamentally different from standard business tax. Between depreciation schedules on equipment and buildings, Section 179 deductions, land basis calculations, crop insurance proceeds timing, and the crushing weight of self-employment taxes — agricultural operations exist in a tax world that most CPAs simply aren’t equipped to navigate.

The tax code contains dozens of provisions written specifically for farmers and ranchers, from income averaging to special use valuation under Section 2032A, MACRS schedules for drainage tile and fencing, and strategies for deferring crop insurance proceeds. But if your advisor doesn’t specialize in agriculture, these deductions go unclaimed — year after year.

At Farm Legacy Consulting, agricultural tax strategy is all we do. We understand the rhythm of farm income, the timing of commodity sales, and the complexity of multi-entity operations. We build tax strategies that work with your operation — not against it — so you keep more of what you earn.

THE OPPORTUNITY

$5B+ in available farm tax deductions go unclaimed annually

43% of farmers overpay taxes due to generic advice

The #1 reason? No ag-specific tax advisor. General CPAs miss deductions that are unique to farming operations.

WHAT'S INCLUDED

Comprehensive Tax Strategy
for Your Operation

Every engagement is tailored to your operation. Here’s what a typical farm tax strategy engagement covers.

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Income & Entity Optimization

Evaluate whether your operation should be a sole prop, LLC, S-Corp, or partnership. Structure for maximum tax efficiency.

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Depreciation & Cost Recovery

Maximize Section 179, bonus depreciation, and MACRS schedules for equipment, buildings, fencing, drainage, and irrigation.

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Crop Insurance & Revenue Timing

Strategically time crop insurance proceeds, government payments, and commodity sales to manage income across tax years.

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Land & Real Estate Strategy

Stepped-up basis planning, like-kind exchanges (1031), conservation easements, and strategies for when you sell, gift, or transfer farmland.

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Self-Employment Tax Planning

Reduce the self-employment tax burden through proper entity structuring, rental income strategies, and Social Security optimization.

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Annual Tax Planning Reviews

Proactive year-round planning, not just year-end scrambling. Quarterly check-ins to adjust strategy based on commodity prices, weather, and yields.

HOW IT WORKS

Our Proven Tax Planning
Process

A structured, step-by-step approach that takes the guesswork out of farm tax planning and puts you in control.

Farm Financial Review

We analyze your last 3 years of tax returns, financials, and operation structure to identify missed deductions, overpayments, and structural weaknesses.

Tax Strategy Blueprint

We build a customized, multi-year tax strategy based on your specific operation — crops, livestock, land, equipment, and family situation.

Entity & Structure Optimization

If your current entity structure isn't serving you, we recommend changes — from sole prop to LLC, partnerships, or S-Corp election — with full implementation support.

Implementation & Coordination

We work alongside your CPA and bookkeeper to implement the strategy. If you need a new CPA who understands agriculture, we'll help you find one.

Ongoing Monitoring

Tax law changes. Commodity prices shift. Weather happens. We adjust your strategy throughout the year to keep you ahead — not scrambling at year-end.

WHO THIS IS FOR

Farm Tax Strategy Is Right for You If...

✓ You suspect you're paying more in taxes than you should be

✓ Your CPA doesn't specialize in agriculture

✓ You've had a big year and need to manage the tax hit

✓ You're buying or selling land, equipment, or livestock

✓ You've never had a multi-year tax strategy — just year-end filing

✓ You want to coordinate tax planning with your succession plan

COMMON QUESTIONS

Frequently Asked
Questions

Farm tax planning involves an entirely different set of rules and strategies. Agricultural operations have access to unique deductions — accelerated depreciation on equipment and buildings, Section 179 expensing for drainage tile and fencing, crop insurance deferral elections, income averaging over prior years, and special use valuation under Section 2032A for estate purposes. Self-employment tax strategies also differ significantly for farmers. A general tax advisor may know some of these exist, but rarely understands how to use them together as part of a coordinated, multi-year strategy.

There's a critical difference between tax compliance and tax strategy. Most CPAs are compliance-focused — they file your return accurately based on the numbers you give them. A farm tax strategist is proactive: we look ahead, model scenarios, and make recommendations throughout the year to minimize your tax burden before year-end. Think of it this way — your CPA is the scorekeeper, we're the coach. We work alongside your CPA, not in place of them.

Yes. Self-employment tax is one of the biggest — and most overlooked — tax burdens for farmers. We use strategies like entity restructuring (moving from a sole prop or partnership to an S-Corp election), separating rental income from operating income, and optimizing Social Security contributions to reduce what you owe. The right structure can save tens of thousands of dollars per year in self-employment taxes alone.

Bad years actually create strategic opportunities. Farm income averaging allows you to spread current-year income over the prior three years, potentially lowering your effective rate. Net operating losses can be carried back or forward to offset taxes in profitable years. Crop insurance proceeds can be deferred to the following tax year under certain elections. And disaster-related provisions may provide additional relief. We help you turn a tough year into a tax planning advantage.

We focus on strategy, not compliance. Our role is to build the plan, model the scenarios, and make the recommendations that minimize your tax burden. We then coordinate closely with your CPA to ensure the strategy is implemented correctly on your returns. If you don't have a CPA who understands agriculture, we'll help you find one who does — that relationship matters.

Now. The best results come from year-round planning, not December scrambling. By the time most farmers think about taxes, the year is almost over and the biggest opportunities have already passed. We recommend starting tax planning at the beginning of the year and checking in quarterly to adjust for commodity prices, weather events, equipment purchases, and changes in tax law. Proactive beats reactive — every time.