June 10, 2010 – Author: Van Varner, Michigan State University Extension
Editor’s note: This commodity is from the athenaeum of the MSU Crop Advisory Team Alerts. Check the characterization of any pesticide referenced to ensure your use is included.
Many MSU County Addendum offices get buzz calls from farmers apprehensive how they can get a tax absolved cardinal so they do not acquire to pay sales tax on items acclimated for their farm. There are a few key credibility that charge to be fabricated apropos this matter. First, there is no such affair as a “sales tax absolution number” for agriculture; and farmers should not use your amusing aegis cardinal as affidavit for a sales tax absolved purchase. USDA defines a acreage as “any abode from which $1,000 or added of agronomical articles were produced and sold, or commonly would acquire been sold, during the demography year.” The $1,000 is the gross bulk or the gross sales bulk of the product. The KEY WORDS are that the acreage or commodity is in “the assembly of able agronomical or agronomical pursuits as a business enterprise.”
Second, amuse agenda there are some items that are not absolved for agriculture, such as architecture food for added absolute acreage structures. Drainage asphalt does qualify, as does atom dehydration accessories and accustomed or propane gas acclimated to ammunition that accessories for agronomical purposes.
The affidavit that condoning producers, organizations and added absolved entities may use, is the Michigan Sales and Use Tax Affidavit of Absolution or anatomy 3372 begin at website: http://www.michigan.gov/documents/taxes/3372_216612_7.pdf
Producers will agenda on account 4, in breadth 3, that you are to announce the allotment of the acquirement account is for agronomical assembly and that allotment would be absolved from sales tax. Producers are encouraged to complete this anatomy and accord to vendors back authoritative absolved purchases.
Most acreage retail businesses artlessly acquire a breadth on the acquirement paperwork for condoning items, requesting the producer’s signature. Vendors or sellers are appropriate to absorb the absolution certificates for a aeon of at atomic four years. It is alternative for businesses to acquire or adios any or all absolved purchases.
Note in breadth four of anatomy 3372, breadth the ambassador fills in acquaintance advice and signs the form, declaring “that the advice on this affidavit is true…” Businesses may be audited by the Michigan Department of Treasury; however, the signature on the anatomy is the being or business that will ultimately be appropriate to appearance affidavit and be in compliance, not the vendors or seller.
Added advice can be begin at the Michigan Department of Treasury website: http://www.michigan.gov/treasury
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