MDA Now Accepting Applications for 2024 Beginning Farmer Tax Credit
Eligible parties are encouraged to apply early for funding
St. Paul, MN: The Minnesota Department of Agriculture?s (MDA) Rural Finance Authority (RFA) is now accepting applications for the 2024 Beginning Farmer Tax Credit, an annual program available to landlords and sellers (asset owners) who rent or sell farmland, equipment, livestock, and other agricultural assets to beginning farmers.
Asset owners can claim credits in?one?of the following categories in a given tax year for?each?beginning farmer they lease/sell to:
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?
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Tax Credit Amount
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Maximum
Tax Credit
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Application Due Date
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Cash Rentals
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10% of annual rental income
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$7,000
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July 17, 2024
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Share Crop Rentals
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15% of annual rental income
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$10,000
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July 17, 2024
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Farmland Sales
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8% of sale price (12% if the buyer is an emerging farmer)
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$50,000
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November 1, 2024
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All other sales (equipment, livestock, etc.)
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5% of sale price
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$32,000
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November 1, 2024
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Total funding available for the 2024 Beginning Farmer Tax Credit program is $4 million. The credits are funded in a first-come, first-served manner, so applicants are highly encouraged to apply early in the year before the stated deadlines. Both the asset owners and beginning farmers must submit applications with lease and/or sale documents to be eligible for funding and to hold their place in line. They may apply before sales close, if needed.
Qualifying asset owners can include individuals, trusts, or qualified pass-through entities renting or selling land, livestock, facilities, buildings, or machinery used for farming in Minnesota to a beginning farmer. Through changes made to the program during the 2023 legislative session, parents, grandparents, and siblings are now eligible for the tax credit if they sell farmland to a direct family member. However, this does not apply to leases or non-land sales (e.g., livestock, vehicles).
A beginning farmer is defined as a Minnesota resident with the desire to start farming or who began farming within the past 10 years. They must provide positive projected earnings statements, have a net worth less than $979,000, and enroll in, or have completed, an approved farm business management (FBM) program.
Beginning farmers are also eligible for a nonrefundable Minnesota tax credit equal to the amount paid for FBM tuition, up to a maximum of $1,500. This tax credit is available for up to three years.
Full eligibility requirements and application materials can be found on the Beginning Farmer Tax Credit web page. Questions may be directed to Jenny Heck at [email protected] or 651-201-6316.
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