The Ohio Department of Agriculture (ODA) announced the availability of the Beginning Farmer Tax Credit Wednesday to help ensure new producers have the resources to provide for their families and those across the state.
Along with beginning farmers, asset owners, or people or businesses that sell or rent farmland, livestock, buildings or equipment to beginning farmers may apply as well. In order for land to qualify as an asset, it must either total at least 10 acres or produce an average annual income of at least $2,500 for farming.
The tax credit equals 3.99 percent of the sale price in the case of a sale or the gross rental income that the individual or business received during the first three years of a rental or share-rent agreement.
“Agriculture and food is Ohio’s number one industry,” said ODA Interim Director Tracy Intihar. “The Beginning Farmer Tax Credit will help keep costs down for new producers and encourage others to help them. This incentive ensures that our state will continue to provide for local communities, the country, and even the world.”
To qualify for the credit, a beginning farmer must be someone who is seeking entry to or has entered farming within the last 10 years.
James Morris, an agriculture educator with the Highland County Ohio State University (OSU) Extension, said he receives frequent calls from new or prospective farmers seeking advice.
“We get people who are in the county diversifying their operations and diversifying their small farms who typically haven’t utilized that land before, and we have people who are becoming more involved in agriculture every day, and those are the folks that we typically work with a lot on helping them get established to find out what kind of production system is going to fit their interests and their land capabilities,” said Morris.
“To see a House bill come out for Ohio, this is significant, and obviously that is happening across the state, and not just here in Highland County, so I think it’s really beneficial, and it’s going to have a lot of impact due to the demand that we’re seeing here in the county to become more diversified and be able to start new farms,” he said.
Morris said that while the tax credit may not increase the number of farmers in Highland County, it will make it easier for beginning farmers to become established.
“The initial costs to get established really force a lot of people out, so I think that’s where this tax credit can really help those that are already thinking about it be more successful,” he said. “I think we see a lot of people try this and aren’t successful because of the overwhelming costs, and I think it definitely is going to help beginning farmers at a level of assistance to help them be successful in getting started for sure.”
Morris pointed out that an applicant must be a certified beginning farmer in order to qualify for the tax credit. “The way they can be certified is a couple of ways – through the Ohio Department of Agriculture or through a land grant university which includes the Ohio State University and Central State University,” he said. “The Ohio State Extension will be able to play a role in certifying a certificate to make these tax credits available to the sellers.”
Morris said the classes are not currently offered but will be available soon.
Beginning farmers and businesses or individuals who sell agricultural assets to beginning farmers can submit applications for the tax credit to [email protected].
Reach John Hackley at 937-402-2571.