Taxes

[Bens-Bees]

This year I'm making the move from avid hobbyist to full on sideliner (you can stop laughing at me now, lol), but I'm a little confused as to what taxes might apply, and I figure you commercial beeks would be the best to answer that. I won't be moving bees out of my home state for pollination for starters, so that probably narrows down the list of possible taxes I might have to pay... but in state (Tennessee) I am selling honey and doing some small pollination contracts as well as cutouts/trapouts, and apart from claiming the money earned as income, what other taxes apply? Is there an agricultural tax that it would fall under or do I need to pay sales taxes, or both, or something else? I figure someone here can at least help point me in the right direction.

[adam@azapiaries]

I would contact a reputable accountant, each state has different sales tax, income tax laws. Here in CT, honey is a food product with no sales tax. Candles sold at retail are taxable. If you wholesale them, you would need to get resale certificates from the retailers. I mention this only to point out how complicated it can get, therefore, you need to consult an accountant.

[BMAC]

I think it varys from state to state and county to county. Here in NY we only pay income tax on it. There is not ag accessed tax. However when we lived in Missouri Cass county wanted you to pay them a certain amount of money per number of hives you owned. Just like they do with cattle.

[Mr. C]

There was a nice article in ABJ (or was it BC) last month about taxes, but I agree definately consult a taxpro especially since this is your first year filing that way, there's lots of rules on claiming expenses etc, which is the whole advantage of claiming it as a business in my understanding (you only pay taxes on profit, not gross sales).

[Rader Sidetrack]

Here is a link to a "summary" document (52 pages ) on sales and use tax in Tennessee. Honey is considered a "food or food product", and therefore subject to sales tax, but if you apply for an "Agricultural Sales and Use Tax Certificate of Exemption" there are agricultural exemptions for certain purchased items, and farmer sales [think honey] direct to consumers is exempt from sales tax in certain situations.

http://www.tn.gov/revenue/taxguides/salesanduse.pdf

If your farm property is at least 15 acres, there is a possibility of reduced property taxes if you meet certain conditions, including reporting at least $1500 gross farm annual income. The link below is from Knox County, but the rules are the same statewide.
http://www.knoxcounty.org/property/greenbelt.php