10 Tax Tips for Farmers

Weather-related Sales
Severe weather can cause farmers to sell some of their livestock. Luckily, the IRS will not tax that income until the following year. Gene Rhoden-Weatherpix/Getty Images

While all of us love to complain about the weather, a farmer really has a right to curse the cold or shake a fist at the sun. The IRS once again disproves its cold, intractable reputation by showing some understanding of the farmer's plight against nature. The stuffily titled "Sales Caused by Weather-Related Conditions" postponement is actually the IRS's way of saying it gets it.

The premise is pretty basic: If you're a farmer who had to sell or exchange more livestock than you normally would have because of weather conditions, you don't have to claim that income as taxable until the next year. If the weather -- we're talking anything from hurricane to drought -- caused you to have to drop inventory fast, you're eligible. You just have to show that it was outside the pattern of your usual business practice. Likewise, you need to prove that the area designated for federal assistance negatively impacted the water, grazing or livestock requirements for your farm. There's some really specific information to convey to the government if you're trying to postpone taxes on livestock sales, so be sure to check out Publication 225 for more detail [source: IRS].