Tax Clarification resulting from HOUSE BILL 1050 – Sales and Use Tax for Farmers

Revised 7-14-14
Revised 7-9-14
Revised 6-27-14

From NC State University Extension Specialist, Guido van der Hoeven:

“In 2013 the General Assembly passed changes to tax law that became effective January 1, 2014. These changes created questions as to how some farms may become subject to an expanded sales tax base or not on products they sell, as well as, qualifying for sales tax exemption on farm inputs. House Bill 1050, passed by the General Assembly and signed by the Governor on May 29, 2014 provides clarification to some of these questions.”

Tax Clarification resulting from HOUSE BILL 1050 (updated 6-27-14) provides a 2-page discussion on the following topics:

  • Sales and Use Tax: Collection and Remittance by Farmers on product sales
  • Sales and Use Tax: Sales tax exempt purchase of farming inputs

Additionally, from an email from NCDOR, “We added additional information to the Department’s website regarding the new requirements for qualifying farmers and a conditional farmer exemption certificate. Specifically, we have added a number of FAQs for each that we believe will be helpful.”

The link to the website is here:

The above information is provided for educational purposes only. You are encouraged to seek professional tax or legal advice in regards to your facts and circumstances regarding the application of these general tax principles.  

TAX ADVICE DISCLAIMER:  To the extent that this content contains legal or tax advice, this written advice is not intended or written to be used, and it cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. 

Written By

Joanna LelekacsExtension Local Foods Flagship Program Manager (919) 515-1195 ANR/CRD - NC State University

Contributing Specialist

Guido van der HoevenExtension Specialist, Econ Income Taxes / Ag Finance / Farm Info Systems (919) 515-9071 Agricultural & Resource Economics - NC State University

Posted on Jun 2, 2014

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