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J.K. Lasser's Small Business Taxes 2013: Your Complete Guide to a Better Bottom Line by Barbara Weltman

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Farm-Related Tax Credits

Farmers may be entitled to claim the same tax credits available to other businesses (discussed in Chapters 7 and 23). For example, if they pay wages to certain types of workers, they may be eligible to claim employment credits. But, there are also credits unique to farmers.

Farm-Related Credits

In addition to credits available to nonfarm businesses, certain credits may be unique (or more relevant) to farmers. These include:

AGRICULTURAL CHEMICALS SECURITY CREDIT

You can claim a tax credit of 30% of qualified expenditures not exceeding $2 million (additional limits apply to a facility). Qualified expenditures are expenses for employee security training and background checks, limiting access to agriculture chemicals, locking tank values, and protecting the perimeter of the facility.

UNDYED KEROSENE AND UNDYED DIESEL FUEL FOR HOUSEHOLD USE

The credit is the amount of excise tax paid on kerosene used in your home for heating, lighting, and cooking.

FEDERAL TAX PAID ON FUELS

The credit is the amount of excise tax paid on gasoline, special motor fuels, diesel-water fuel emulsion, and compressed natural gas used on a farm for farming purposes. The credit is claimed by the ultimate purchaser, rather than the ultimate vendor—the farmer who bought the fuel and did not resell it.

FUELS USED IN OFF-HIGHWAY BUSINESS USE

The credit is for the amount of excise tax paid on fuels, including alternative fuels, used in running stationary machines (such as generators), for ...

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