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CAUTION

If you provided taxable fringe benefits to your employees, such as personal use of a car, don’t include in farm labor the amounts you depreciated or deducted elsewhere.

Line 23 Enter your deduction for contributions to employee pension, profit-sharing, or annuity plans. If the plan included you as a self-employed person, enter contributions made as an employer on your behalf on Schedule 1 (Form 1040), line 16, not on Schedule F (Form 1040).

In most cases, you must file the applicable form listed next if you maintain a pension, profit-sharing, or other funded-deferred compensation plan. The filing requirement isn’t affected by whether the plan qualified under the Internal Revenue Code, or whether you claim a deduction for the current tax year. There is a penalty for failure to timely file these forms. See U.S. Department of Labor .

Form 5500-EZ. File this form if you have a one-participant retirement plan that meets certain requirements. A one-participant plan is a plan that covers only you (or you and your spouse).

Form 5500-SF. File this form electronically with the Department of Labor (at efast.dol.gov ) if you have a small plan (fewer than 100 participants in most cases) that meets certain requirements.

Form 5500. File this form electronically with the Department of Labor (at efast.dol.gov ) for a plan that doesn’t meet the requirements for filing Form 5500-EZ or 5500-SF.

For details, see Pub. 560.

Lines 24a and 24b If you rented or leased vehicles, machinery, or equipment, enter on line 24a the business portion of your rental cost. But, if you leased a vehicle for a term of 30 days or more, you may have to reduce your deduction by an inclusion amount. See Leasing a Car in chapter 4 of Pub. 463 to figure this amount.

Enter on line 24b amounts paid to rent or lease other property such as pasture or farmland.

Line 25 Enter amounts you paid for repairs and maintenance of farm buildings, machinery, and equipment that are not payments for improvements to the property. Amounts are paid for improvements if they are for betterments to your property or restorations of your property (such as the replacements of major components or substantial structural parts), or if they adapt your property to a new or different use. See chapter 4 of Pub. 225 for more information.

Don’t deduct repairs or maintenance on your home.

However, you may be able to elect to capitalize and depreciate certain amounts paid for repair and maintenance of tangible property to the extent you treat these amounts as capital expenditures on your books and records regularly used in

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• Estate and gift taxes.

• Taxes assessed for improvements, such as paving and sewers.

• Taxes on your home or personal-use property. You may be able to deduct on line 32 expenses related to your home or principle residence, such as property taxes, if you use your home to conduct farming activities. See Business use of your home, later.

• State and local sales taxes on property purchased for use in your farming business. Instead, treat these taxes as part of the cost of the property.

• Other taxes not related to your farming business.

Line 30 Enter amounts you paid for gas, electricity, water, and other utilities for business use on the farm. Don’t include personal utilities. You can’t deduct the base rate (including taxes) of the first telephone line into your residence, even if you use it for your farming business. But you can deduct expenses you paid for your farming business that are more than the cost of the base rate for the first phone line. For example, if you had a second phone line, you can deduct the business percentage of the charges for that line, including the base rate charges.

Lines 32a Through 32f Include all ordinary and necessary farm expenses not deducted elsewhere on Schedule F (Form 1040), such as advertising, office supplies, etc. Don’t include fines or penalties paid to a government for violating any law. For details on business expenses, see chapter 4 of Pub. 225.

At-risk loss deduction. Any loss from this activity that wasn’t allowed last year because of the at-risk rules is treated as a deduction allocable to this activity in 2025. See Form 6198 and its instructions for more details.

Bad debts. See chapter 8 of Pub. 334.

Business startup costs. If your farming business began in 2025, you can elect to deduct up to $5,000 of certain business startup costs. The $5,000 limit is reduced (but not below zero) by the amount by which your startup costs exceed $50,000. Your remaining startup costs can be amortized over a 180-month period, beginning with the month the farming business began. For details, see chapters 4 and 7 of Pub. 225. For amortization that begins in 2025, you must complete and attach Form 4562.

Business use of your home. You may be able to deduct certain expenses for business use of your home, subject to limitations. You may also be able to use a simplified method to figure your deduction. Use the appropriate worksheets in Pub. 587 to figure your allowable deduction. Don’t use Form 8829.

De minimis safe harbor for tangible property. You may be able to elect to use a de minimis safe harbor to deduct amounts paid for certain tangible real or personal property used in your

farming business. If you elect the de minimis safe harbor for the tax year, enter the total amounts you paid for property qualifying under the de minimis safe harbor on line 32. Don’t include these amounts on any other line. For details, see chapter 8 of Pub. 334.

Energy efficient commercial buildings deduction. You may be able to deduct part or all of the expenses of modifying an existing commercial building to make it energy efficient. For details, see Form 7205 and its instructions.

Forestation and reforestation costs. Reforestation costs are generally capital expenditures. However, for each qualified timber property, you can elect to expense up to $10,000 ($5,000 if married filing separately) of qualifying reforestation costs paid or incurred in 2025.

You can elect to amortize the remaining costs over 84 months. For amortization that begins in 2025, you must complete and attach Form 4562.

The amortization election doesn’t apply to trusts, and the expense election doesn’t apply to estates and trusts. For details on reforestation expenses, see chapters 4 and 7 of Pub. 225.

Legal and professional fees. You can include on this line fees charged by accountants and attorneys that are ordinary and necessary expenses directly related to your farming business. Include fees for tax advice and for the preparation of tax forms related to your farming business. Also, include expenses incurred in resolving asserted tax deficiencies related to your farming business.

Tools. You can deduct the amount you paid for tools that have a short life or cost a small amount, such as shovels and rakes.

Travel and meals. In most cases, you can deduct expenses for farm business travel and 50% of your business meals. See the instructions for Schedule C (Form 1040), lines 24a and 24b.

Line 34

Figuring your net profit or loss. If line 33 is more than line 9, don’t enter your loss on line 34 until you have applied the at-risk rules and the passive activity loss rules. To apply these rules, follow the instructions for line 36 and the Instructions for Form 8582. After applying these rules, the amount on line 34 will be your loss, and it may be smaller than the amount figured by subtracting line 33 from line 9. You may also be required to file Form 461, which limits the allowable loss. See Form 461 and its instructions for more information.

If line 9 is more than line 33, and you don’t have prior-year unallowed passive activity losses, subtract line 33 from line 9. The result is your net profit.

If line 9 is more than line 33, and you have prior-year unallowed passive activity losses, don’t enter your net profit on line 34 until you have figured the amount of prior-year unallowed passive activity losses you may claim this year for this activity. Use Form 8582 to figure the amount of prior-year unallowed passive activity losses you may include on line 34. Make sure to indicate that you are including prior-year passive activity losses by entering “PAL” to the left of the entry space.

If you checked the “No” box on line E, see the Instructions for Form 8582; you may need to include information from this schedule on that form, even if you have a net profit.

Partnerships. Subtract line 33 from line 9. If the amount is a loss, the partners may need to apply the at-risk rules and the passive activity loss rules to determine the amount of their loss on line 34. A partner may also be required to file Form 461 to limit any excess business loss. See Form 461 and its instructions for more information.

Reporting your net profit or loss. Once you have figured your net profit or loss, report it as follows. You must also consider any excess business loss limitation. See Form 461 and its instructions for more information.

Individuals. Enter your net profit or loss on line 34 and on Schedule 1 (Form 1040), line 6 and; Schedule SE (Form 1040), line 1a.