Rural Money: New Rule Lets Farm Families Spread Out Taxes on Farmland Sales

Paul Neiffer outlines the requirements and when the change takes effect

KANSAS CITY, MISSOURI (RFD News) — Farmers selling farmland may now be able to spread out their tax payments over several years under a new provision. However, there are a few requirements.

Farm CPA Paul Neiffer says the land must have been actively farmed for at least 10 years before it is sold. It also has to stay in farming for 10 years after the sale, with that agreement recorded with the property.

He says the full income from the sale is still reported right away, but the taxes don’t all have to be paid at once.

Instead, 25 percent of the tax is due April 15 after the sale, with the rest paid over the next three years.

There’s also some confusion around timing.

While the rule applies to sales after July 4, 2025, it applies only to tax years that begin after that date. For most farmers, that means it won’t apply until the 2026 tax year.

Neiffer says the benefit depends on interest rates, but spreading out payments could help lower the overall tax burden.

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Knoxville native Neal Burnette-Irwin is a graduate from MTSU where he majored in Journalism and Entertainment Studies. He works as a digital content producer with RFD News and is represented by multiple talent agencies in Nashville and Chicago.


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