Nebraska Sales and Use Tax Exemption for Agricultural Repair and Replacement Parts

As the crop season gets underway, now is a good time to remind everyone of that the Nebraska, effective October 1, 2014, exempts sales and use tax when purchasing agricultural repair and/or replacement parts.

Per the Nebraska Department of Revenue’s Sales Tax Exemption Chart, (and based upon this Department of Revenue regulation) any repair or replacement parts for agricultural machinery and equipment used in commercial agriculture is exempt from sales and use tax.  Form 13 is required when using the exemption; specifically, you must fill out Section B of Form 13 and indicate that the exemption is for commercial agriculture.

The exemption for repair and replacement parts is separate from the Nebraska Personal Property Tax Exemption for beginning farmers.  The Personal Property Tax Exemption requires an application to the Nebraska Department of Agriculture, as well as supporting documentation.  The exemption for repair and replacement parts does not require such steps.

If you have any questions, please feel free to contact us!  We’re always here to help.

Thinking about grant funding? Multiple requests for applications released

Are you a small farmer, looking at expanding your operation to local schools or to a more regional focus? Or perhaps expanding into a farmers market?  Maybe you need some assistance to stay on the land in the face of financial crisis and natural disasters.  Well, read on, as there are multiple grant opportunities currently available.

Farm to School Grant Program:

Funded through the USDA’s Food and Nutrition Service, up to $6 million in funding is available via four different types of grants.  Planning grants are to assist schools is starting a farm to school program whereas implementation grants are to assist in expanding current farm to school programs.  Support grants are for non-profit, tribal nations, state and local entities, and producers to assist schools with further developing and providing broad-reaching support services to farm to school initiatives.  Finally, training grants are intended to support trainings that strengthen farm to school supply chains, or trainings that provide technical assistance in the area of local procurement, food safety, culinary education, and/or integration of agriculture-based curriculum.

Grant applications are due May 20, 2015 and training grant letter of intent is due April 30, 2015.

Farmers Market Promotion Program and Local Food Promotion Program:

Funded through the USDA’s Agricultural Marketing Service, the Farmers Market Promotion Program and Local Food Promotion Program provide a total of $26.6 million, equally divided between the program.  The Farmers Market program is aimed at supporting direct marketing avenues, such as farmers markets, community supported agricultural programs, roadside stands, and agri-tourism.  The Local Food Promotion Program, on the other hand, is aimed at supporting intermediary supply chain activities for businesses that process, distribute, aggregate, and store locally or regionally produced food.

Grant applications for each program are due on May 14, 2015.  You may submit an application to each grant but, if your proposal is accepted for both grants, you may only be funded through one program.

If you are interested, grant writing workshops in every state are scheduled.

Farm Aid:

For non-governmental grant funding, Farm Aid’s annual grants to promote family farm system are open.  Letters of inquiry are due May 1, 2015 and fully proposals by August 1, 2015.  Grants are for non-profit organizations, from $3,000 to $10,000, that focus upon one of three areas: (1) Growing the Good Food Movement; (2) Helping Farmers Thrive; and (3) Taking Action to Change the System.  Growing the Good Food Movement supports program building local and regional food systems, direct marketing, and value-added markets.  Helping Farmers Thrive focuses upon projects for getting started on the land, accessing new markets, transitioning to more sustainable farming practices, production of renewable fuels, and staying on the land in face of financial crisis and natural disasters.  Finally, Taking Action to Change the System funds organizations promoting fair farm policies and grassroots organizing campaigns.

2015 Nebraska Farmland Values and Rental Prices

The University of Nebraska – Lincoln’s Cornhusker Economics has recently published their review of the 2015 trends in Nebraska farmland values and rental rates.

For the first time in recent years, overall Nebraska farmland values decreased by approximately 3%, or a valuation of $3,210 per acre.  More specifically, the statewide numbers show:

  • Dryland cropland with irrigation potential declined the most, at 10%, for a valuation of $4,740 per acre
  • Dryland cropland with no irrigation potential declined 9%, for a valuation of $3,385 per acre
  • Gravity irrigated cropland decreased 4%, for a valuation of $7,005
  • Center pivot irrigated cropland decreased 2%, for a valuation of $7,495

Unsurprisingly, pastures and cow-calf pair rental rates increased about 15% across the state due to higher cattle prices and drought assistance via the Livestock Forage Disaster Program.  Interestingly:

  • The big mover is hayland, up 20%, for a valuation of $2,350
  • Tillable grazing land is up 7%, for a valuation of $1,490 per acre
  • Nontillable grazing land is up 12%, for a valuation of $970 per acre

Rental rates reflect the above changes in valuation.  Cropland rental rates are down across the state, with two exceptions: dryland cropland in central Nebraska (increase of 5%) and center pivot cropland in northeast Nebraska (increase of 1%).  Pasture rental rates are up, ranigng from $85 in the northeast to $11 in the northwest.  Both central and southwest Nebraska are up 34% ($40 and $27 respectively).

Rental rates for cow-calf pairs tracks the grazing land numbers.  Average dollar per pair is $60, up 40%.

More information is available in the article but, all things considered, the valuation decrease does not erase the gains made in previous years.  Moreover, the increase in the cattle market is directly responsible for the increase in pasture and cow-calf pairs.

If you have further questions, you are welcome to contact us!

Deadline Extension For Updating Basis and Yield

A quick note that serves as an addendum to yesterday’s post.  The USDA has announced a one-time extension to update basis and yield due to the implementation of ARC and PLC safety-net programs.

The deadline to update basis and yield is extended from February 28, 2015 to March 31, 2015.  This is the same date for producers to elect between ARC and PLC coverage.

If no updates are made to basis and/or yield, the farm’s current base and yield will be used.  Additionally, if no election between PLC and ARC is made by March 31, 2015, the farm will automatically be enrolled for PLC coverage through the 2018 crop year  and no payments for the 2014 crop year will be made.

In short:  make the time to study the choices, use the online decision-tools and head over to your local FSA office with questions and to make elections if so desired.

Deadlines Approaching for Farm Program Sign-Ups

As we approach the spring and the planting season, it is a good idea to take a long, hard look at the various programs available for assistance and their respective deadlines.  In chronological order:

Conservation Stewardship Program — The deadline for CSP sign-up is extended to Friday, March 13, 2015.  We’ve previously discussed CSP and the benefits that may accrue to applicants.  If you are interested, head over to your local NRCS office to complete the initial two-page application.

Environmental Quality Incentives Program — EQIP has rolling deadlines of March 20, April 17, and May 15.  EQIP is a voluntary working lands program offering farmers and ranchers cost-share funding and technical assistance.  EQIP now provides up to a 50% cost-share for beginning and limited resource farmers.  EQIP can help fund a number of projects, including high tunnels, organic conservation, and other conservation practices.  Like CSP, just head over to your local NRCS office for more information as it varies state by state.

Organic Production Survey — The survey is due April 3, 2015.  The survey is specifically for the organic sector, to determine growth, trends, and challenges.  The survey may be taken electronically, so feel free to review our previous article and let the USDA know what you think.