In 2013, the General Assembly raised taxes on small farms and beginning farmers, a change that will be implemented on July 1, 2014. The General Assembly raised taxes on these farmers by making the sales tax exemption available only to farmers grossing over $10,000 per year.
When it was introduced, House Bill 1050 served to fix one problem with last year’s law–that in some years, a farmer may have no or very little income due to weather, disease or other hardship. The bill sought to change the 2013 law and allow farmers to qualify for the sales tax exemption if they either gross $10,000 in a year or average $10,000 per year in sales over a three year period.
The Sales and Use Tax Division has added an Important Notice: Qualifying Farmer and Conditional Farmer Exemption. The Division has issued notice covering recent law changes to what constitutes a qualifying farmer and sets out the amended law that added a conditional farmer exemption.
The notice can be found at http://www.dornc.com/taxes/sales/impnotice062514_2.pdf
Applications were also created in order for an applicant to apply for an exemption certificate number for qualified purchases.
Form E-595QF, Application for Qualifying Farmer Exemption Certificate Number for Qualified Purchases can be found at http://www.dornc.com/downloads/e595qf.pdf
Form E-595CF, Application for Conditional Farmer Exemption Certificate Number for Qualified Purchases can be found at http://www.dornc.com/downloads/e595cf.pdf
Questions about the information provided in this document, can be directed to the Taxpayer Assistance and Collection Center toll-free at 1-877-252-3052 or by mail to the Taxpayer Assistance Division, North Carolina Department of Revenue, Post Office Box 25000, Raleigh, North Carolina 27640-0001.