Information for beginning farmers.
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Farm operations are exempt from paying sales tax on items used in the farming operation. None of the exemptions are automatic. You must either present an exemption certificate to the vendor when purchasing products or you can claim a refund if you have evidence to show you paid the sales tax. Forms are available on the State Dept. of Taxation and Finance website listed below.
Some of the more common forms applicable to farms include:
ST-125 Farmer’s – Commercial Horse Boarding Operator’s Exemption Certificate
Exempts you from paying sales tax on the purchase of tangible personal property used predominantly (more than 50%) in farm production or horse boarding; includes: building materials, production equipment and supplies, animals, feed, hardware, motor vehicles, fuel (not motor fuel), gas/propane, electricity, refrigeration. Also applies to labor and services hired for repairing, maintaining or servicing property used in farming.
There are many subtle exemptions so it pays to check with the State if you are uncertain about whether an item or service you are purchasing is exempt from sales tax (and if the seller is unsure). Phone assistance is available by calling 800-972-1233 – website: www.tax.state.ny.us
Copies of this form are available form is available on the website above or call your county extension office. Make sure you have copies of the form (ST-125) with you when making purchases. If you make numerous purchases with a particular supplier, check the box “blanket certificate” and the vendor can keep the form on file for future purchases.
PR-955 Claim for Refund by Farmers and Commercial Horse Boarding Operators – Sales Tax on Utilities, Fuel Oil and Motor Fuel (not for motor fuel tax)
www.tax.ny.gov/pdf/memos/sales/m00_8s.pdf – This form may be used to claim a refund if you have paid sales tax on any of the above items. You do not have to fill out this form if you have an exemption certificate on file with the vendor. You must have receipts to justify this claim. File annually or semi-annually.
FT-1004 Certificate for Purchases of Diesel Motor Fuel or Residual Petroleum Product for Farmers and Commercial Horse Boarding Operations
www.tax.ny.gov/pdf/2006/motor/ft1004_306.pdf – Exempts you from paying sales tax on diesel motor fuel used for faming purposes. Dealers can keep this form on file (check blanket certificate) so you do not have to fill out a new form for each new purchase.
FT-500 Application for Refund of Sales Tax Paid on Automotive Fuels
www.tax.ny.gov/pdf/2009/st/ft500_809.pdf – Need to submit invoices with the refund application.
DTF-803 Claim for Sales and Use Tax Exemption -Title/Registration Motor Vehicle, Trailer, ATV, Boat, Snowmobile
www.tax.ny.gov/pdf/1996/st/dtf803_196.pdf – This form is not used to make purchases. Restricted to transactions processed by DMV. Motor vehicles must be predominantly used in farming.
ST-126 Exemption Certificate for Purchase of Racehorses
www.tax.ny.gov/pdf/current_forms/st/st126.pdf – Need a certificate for each horse.
Need Help? Telephone Assistance is available Monday-Friday, 8:30 AM-4:25 PM
Business Tax Information: 800-972-1233
Forms and Publications: 800-462-8100
Alternate phone number: 518-485-6800
Website: www.tax.state.ny.us
This fact sheet is part of the Guide to Farming in NY by Monika Roth et al, published by the Cornell Small Farms Program and Cornell Cooperative Extension. Fact sheets are updated once annually, so information may have changed since last revision. If you are reading a printed version of a fact sheet, compare revision date with online fact sheet publish dates to make sure you have the latest version.