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tax question on leased farmland

I cash rent a 90 acres in tennessee. I work a full time job and was wondering how this would be taxed. I know that is a broad question but any help is appreciated

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7 Replies
Senior Advisor

Re: tax question on leased farmland

If you are talking real estate taxes that is paid by the land owner. However the cash rent you pay usually includes that amount within the rental fee.

 

If you're talking income tax you will keep track of income and expenses and file a schedule F with your 1040 tax return. Your income tax bill will reflect the additional income should there be any. You need to talk to a tax professional to learn which items are tax deductable and which are not

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Re: tax question on leased farmland

Im srorry but i worded that incorrectly. I cash lease this farm to another individual that actually farms the land

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Highlighted
Contributor

Re: tax question on leased farmland

Put the lease amount along with other income and expenses on Form 4835 it looks just  like schedule F except you aren't subject to self employment tax ( social security ). It carries to line 17 1040 which triggers a Schedule E( Supplemental Income and Loss) lines 40,41 and 42. If you file a schedule F the amount goes to line 18 and you will be subject to self employment tax.

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Advisor

That is exactly the correct answer, but ...

Ths simple answer is because it is lease income you don't pay social security taxes on it.  There will still be income taxes on it.

 

Look to the answer above for the procedure to follow.

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Senior Contributor

Re: tax question on leased farmland

While we are on the subject of taxes how should I handle tile and tile installation. Would it matter that it is on ground that I lease from a neighbor. Do I need a 1099 for the contractor.
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Veteran Advisor

And, what about CRP?

 
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Senior Advisor

Re: And, what about CRP?

You'll probably get a 1099 from the Gov. on the CRP payments.

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