I have read this forum begining to end. A few things that may come in handy that we have learned in the past 8 years farming In the U.P.
* Get a business license, what better way to show you are in Business! In Houghton County it cost $15. That is a licensing fee, and is tax deductible.
* Go to the IRS website and get your EIN, you are a business.
* Having both of these inhand, you do NOT have to pay sales tax on any item for your 'business' I am typing this on my 'business laptop'. No sales tax on feed.....ok, its a 6% discount anyway up front.
Wal-mart (as well as Sams Club) gives you a card to present at the register for your T/E (Tax Exempt) items. Light bulbs for the chicken coop T/E.
* As a business keep a millage log for your vehicle. Every time you drive to the feed store, its a deduction! The tax form ask how many miles you drove for personal, and how many for business.....keep a log!
* Cell phone - yup, got one....for the business. That number is printed on the business cards.......both are deductions.
* Open a checking account in the business name.
* OK, this may be a little gray area but all of our sales are recorded. We (our family) purchases products from our farm. We do not claim to raise Just for our family, we have items for sale. All businesses sell items even to family members. If you owned a store you could just pick something up off the shelf for your self. But that item cost your business some money to aquire/grow/raise/process/package/market. Pay yourself for your eggs, meat, chicken, tomatoes.....what ever.
The state of Michigan forced us into business in a round about way. I fussed and fumed for a few days until someone pointed out a few of these items. I thought "......you know, your right....why not???".
Now I loose a few thousand dollars each year (according to the tax forms), but the bottom line is we are in business, and Michigan Right to Farm Act now applies to us 100%. No one can say a thing about it. Dust, noise, smells....all covered and perfectly legal.
If we can help others, let us know.
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www.localharvest.org/farms/m19640