tax benifits of Farm

[Mark_in_PA]

What is the name of your state? = PA

This may be more of a tax question, but I will start here. I will be buying a new home soon, I was told that if I buy a farm I can get tax deductions by just growing hay in the field, having someone else crop it down. All I need is some sort of “crop” and a certain amount of acreage.

Is there really that much tax benefits in doing that or is this just the same as having an apartment building as a tax shelter to deduct the deprecation?
If this is the case how many acres do I need in PA?

-Mark

 

[HomeGuru]

What is the name of your state? = PA

This may be more of a tax question, but I will start here. I will be buying a new home soon, I was told that if I buy a farm I can get tax deductions by just growing hay in the field, having someone else crop it down. All I need is some sort of “crop” and a certain amount of acreage.

Is there really that much tax benefits in doing that or is this just the same as having an apartment building as a tax shelter to deduct the deprecation?
If this is the case how many acres do I need in PA?

-Mark

**A: yes, it is a tax question so post in the correct forum please.

 

[BelizeBreeze]

What you are discussing needs to be asked of your county extension office. There are differing levels of farm subsidies and some do include hay as a crop and others do not.

However, purchasing a farm has it's own tax advantages such as a much lower millage (mine is .25 %) and if you greenbelt it or place it (if large enough) in a land trust, much more tax savings when it's time to sell.

I doubt seriously if this forum can help you since, as you surmised, this is more of a tax question than one of law.

 

[HomeGuru]

Hay, good response hexy.

 

[BelizeBreeze]

It comes from smoking that damn Alfalfa

 

[HomeGuru]

That's why there are so many mad cows. They are out on the pasture getting stoned.