Sales tax and other Issues at Beginning Farmers Course

Did you know that Michigan farmers do not need a sales tax number to receive a state sales tax exemption for purchasing certain goods?

In the State of Michigan, there is no requirement for a sales tax exemption number for tangible personal property purchased for agricultural production. Tangible personal property could be items like seeds, fertilizer, spray materials, feed and similar items. Items that are used in land improvement, real estate fixtures or motor vehicles used on highways are not sales tax exempt. Examples of non-sales tax exempt items include: fencing materials, barn cleaners, drain tile, lawn mowers, pumps, trucks and building materials. When purchasing sales tax exempt agricultural items in Michigan, you must sign a certificate stating that the item is for agricultural production. For most agricultural retailers this certificate is part of the invoice or bill of sale. However other retailers may not be aware of this certificate of exemption and sometimes ask for a sales tax exempt number because many sales tax exempt organizations like non-profit organizations do have a sales tax exempt number. A copy of this certificate of exemption is available at the State of Michigan’s website. For more information on sales tax exemption for agriculture, you can go to the Michigan Department of Treasury website.

For people interested in exploring opportunities in small or larger-scale farming, Michigan State University (MSU) Extension is offering a four-evening course for beginning farmers in three Michigan Upper Peninsula locations. A team of presenters will cover farm business basics including: sales tax, small farm machinery, animal and plant based enterprises. Classes will be held on Tuesday evenings in Hancock, Mich., Wednesday evenings in Escanaba, Mic,. and Thursday evenings in Sault Ste. Marie every other week from late January through mid-March. Pre-registration and fee required. For more information, visit Alger County’s MSU Extension website or call Alger 906-387-2530.

The Farm Business Basics session will discuss: hobby farm rules, farm business plan, record keeping, basic tax management, fuel tax credits, sales tax, PA 116, renting land, custom work, grants & cost shares, and government programs. The small farm machinery session will include topics such as tractor selection & safety, utility vehicles, bucket loaders, skid steers, planting, harvesting equipment, and maintenance.

Animal based enterprises such as beef cattle, swine, sheep, goats, dairy cattle, poultry and eggs, horses, exotic species and environmental considerations will be covered. The plant based enterprise session will discuss: commodity grains, hay, vegetables, small and tree fruits, U-Pick farming, organic opportunities, hoophouses, crop rotation and soil considerations. For more information, potential participants may also contact Warren Schauer, MSU Extension educator, at .(JavaScript must be enabled to view this email address) or 906-786-3032.

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