Tax Topic #416 |
2008 Tax Year |
Topic 416 - Farming and Fishing Income
If you have income from your farming or fishing business, you may be able
to avoid making any estimated tax payments by filing your return and paying
your entire tax due on or before March 1st of the year your return is due.
This rule generally applies if at least 2/3 of your total gross income was
made from farming or fishing in either the current or the preceding year.
If March 1st falls on a weekend or legal holiday, you have until the next
business day to file your return and pay the tax.
If you choose not to file by March 1st, you can make a single estimated
tax payment by January 15th to avoid an estimated tax penalty. If these special
rules do not apply, you may have to make quarterly estimated tax payments.
For more information on estimated tax, refer to Publication 505, Tax
Withholding and Estimated Tax.
Income and expenses from farming are reported on Form 1040, Schedule F (PDF). Additionally, self–employment tax may be required
if net earnings from farming are $400 or more. Self–employment tax is
figured on Form 1040, Schedule SE (PDF). For
additional information, refer to Topic 554, Self–Employment
Tax. For more information on farming, refer to Publication 225, Farmer's
Tax Guide.
Income and expenses from fishing are reported on either Form 1040, Schedule C (PDF) or Form 1040, Schedule C-EZ (PDF).
Fishermen may also be required to file Form 1040, Schedule SE (PDF) to
figure self–employment tax if their net earnings from fishing are $400
or more. For general information about the rules applying to individuals,
including commercial fishermen, who file Schedule C or C-EZ, refer to Publication 334, Tax Guide for Small Business. If your trade
or business is a partnership or corporation, see Publication 541, Partnerships,
or Publication 542, Corporations.
Page Last Reviewed or Updated: December 22, 2008
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