Prepaid Farm Expenses: Deduct Now, but Clear Two Gates First
We review what is needed to get a tax deduction for prepaid farm expenses
Buying next year’s seed, feed, fertilizer, chemicals, or fuel before December 31 is one of the oldest tools in the cash-basis farmer’s kit. Done right, you pull the deduction into the current year and smooth out income. Done wrong, the deduction gets deferred or denied outright. Two gates stand between you and that write-off.
