Stocks News

$50,000 First-Time Farmer Tax Credit in Iowa: Applications Now Open

Landowners and agricultural property owners can receive up to $50,000 for doing business with emerging farmers. This credit, called the 2024 Start-up Farmer Tax Credit or Agricultural Asset Transfer Tax Credit, is for people who lease land, equipment and/or buildings to beginning farmers. The Iowa Finance Authority is currently accepting applications for credit.

Beginning Farmer Tax Credit: Estimated Credit Amount

Applications for the 2024 First-Time Farmer Tax Credit are now open in Iowa. This is an annual program that has been in existence since 2007 and is run by the Iowa Finance Authority. The 2007 program budget was $6 million, and the 2024 budget was $12 million.

The purpose of the program is to give new farmers access to land and equipment that they would normally not have access to if they did everything themselves. Another goal of the program is to encourage more people to participate in the agricultural industry.

Qualified applicants may receive a tax credit of between 5% and 15%. Qualifying property owners can deduct 5% of the amount paid in cash rent and 15% of crop share rentals, but the limit is $50,000 per person.

If the total deductions are more than the taxpayer’s total state tax liability, the balance may be carried forward to the following year. Although this program does not directly help beginning farmers, it does help them indirectly, such as by helping them avoid major purchasing costs.

Who can get it and how can I apply?

To qualify for the 2024 Beginning Farmer Tax Credit, applicants must meet the following requirements:

  • Must be an Iowa resident 18 years of age or older.
  • Applicants must have a net worth of up to $833,000. There are no requirements for off-farm income.
  • Applicants must have sufficient education, training, or experience to effectively manage farm operations.
  • You must also have access to sufficient working capital, equipment, and other items needed to run your farm.

The Iowa Finance Authority is currently accepting applications for the 2024 First-Time Farmer Tax Credit. The last date to apply is Aug. 1, 2024, but the state has warned the funds could run out before then. Credits are awarded on a first-come, first-served basis.

To apply to the program, applicants must download the completed form along with all relevant documents and mail it to IADD, 1963 Bell Avenue, Des Moines, IA 50315. Applications are available on the Iowa Finance Authority website.

Applicants with incomplete forms will be notified and will have 30 days from the date of notification to correct and submit missing documents. If not corrected within 30 days, your application will be withdrawn.

Payments are passed on to the property owner, but reporting must be done jointly by the owner and the farmer.

Related Articles

Back to top button