Should you trade in your tractor when you buy a new one.

[Reddogs]

They do, but I thought we were talking about a non-AG tractor.
A utility tractor, used by a land owner to scoop stone, cut grass, etc is not eligible in most cases for a state tax exemption because its not being used to produce a crop.

If you walk into a dealer and tell them you are a farmer, when in fact you are not, you are breaking the tax code laws.

Hey, first thing I checked was whether less than 40hp Tractor had exemption, and its the use that gives it, not the hp..All my tractors always 'farm' or 'plant' when it comes to the ag exemption...

 

[bdhsfz6]

I thought all farmers had an agricultural exemption in the states, I always tell that to the dealer and get no taxes on any tractors or quotes from them.

I'm sure this varies from state to state. In my home state of PA, a tax exempt#, issued to a qualifying business, must be noted on the invoice to avoid paying sales tax. I used to use my father in laws farm# with his permission.

The law was changed at some point so the invoice had to be made out to, and paid by the business. Routine audits forced my dealer, and many others, into strict compliance. I did buy one tractor through my father in law's farm but the paperwork & warranty issues plus the legal risk made it difficult. It's a moot point now since he passed a few years back and the farm's tax exempt status was not renewed.

 

[Hay Dude]

Hey, first thing I checked was whether less than 40hp Tractor had exemption, and its the use that gives it, not the hp..All my tractors always 'farm' or 'plant' when it comes to the age exemption...

Right
AG use exempt
Non-AG use not exempt

A 40HP tractor could be an AG tractor, used for spraying, cultivating, etc. = AG exempt.
A 200HP tractor could be used in a quarry to scoop stone = non-AG exempt

HP/Size has nothing to do with it.

 

[Bill Guenthner]

Taxes on your tractor? What kind of cruelty is that? As for me, I'm staying in Texas...apologies to Davy Crockett.

Sales tax. You have it in Texas too.

 

[Torvy]

Sales tax. You have it in Texas too.

We don't pay it on our Ag tractors, or on other things related to our farming or forestry.

Some states take the taxes regardless of use.

 

[Cobailer]

I've never traded in a tractor, so I do not know the details of this process. After a certain period of time, the tractor inevitably wears out. Therefore, you will have to decide what to do with the tractor that has become useless sooner or later. Given that maintaining the technical condition is not always possible or expensive, I consider selling it the best option. A friend of mine back in the UK sold his tractor, but instead of buying a new one, he went for the better option to buy a used one from https://www.machinerydealer.co.uk/. He says that it has proved to be one of the best decisions he ever made over time.

 

[Reddogs]

Right
AG use exempt
Non-AG use not exempt

A 40HP tractor could be an AG tractor, used for spraying, cultivating, etc. = AG exempt.
A 200HP tractor could be used in a quarry to scoop stone = non-AG exempt

HP/Size has nothing to do with it.

Even if you do use it every now and then for non-exempt uses...just don't take pictures of it and post on facebook.

 

[JethroB]

I forget to use my Ag non-exempt card for small purchases. Need to do better. Stopped by a new Ace Hardware recently for some implement paint & miscellaneous stuff, the cashier noticed my exemption card sticking out of my wallet. Saved me $10. Card cost me $50 a year just to have.

Many states have reciprocal agreements on collecting sales & use taxes. Crossing a state line often won’t help you, particularly on large purchases. Businesses do get audited and somebody is going to pay if due.

 

[D2Cat]

I've never traded in a tractor, so I do not know the details of this process. After a certain period of time, the tractor inevitably wears out. Therefore, you will have to decide what to do with the tractor that has become useless sooner or later.

Are you sure all that is true?

 

[Reddogs]

I forget to use my Ag non-exempt card for small purchases. Need to do better. Stopped by a new Ace Hardware recently for some implement paint & miscellaneous stuff, the cashier noticed my exemption card sticking out of my wallet. Saved me $10. Card cost me $50 a year just to have.

Many states have reciprocal agreements on collecting sales & use taxes. Crossing a state line often won’t help you, particularly on large purchases. Businesses do get audited and somebody is going to pay if due.

Very good to know as just paid a bundle for hydraulic oil at Kubota dealer...