10/15/2026
I’m going to talk about something a little different today. The goat “business”. First let me dispel the myth that you make a lot of money with goats. That is a big nope lol! Some of the goat land clearing operations and huge commercial farms may pull a profit but don’t buy goats thinking you are going to make a lot of money. They can make for a good tax write off and that is what I am going to talk about today. Disclaimer: I am NOT a tax advisor and I highly recommend working with a tax professional if you decide to file a schedule F. I’m going to share some tips to help you maximize your write off without getting tagged as a hobby. Hopefully I won’t get audited for my efforts lol.
We don’t file a separate return for the farm. We use the schedule F to claim farm profit or loss on our 1040. You must claim all income but you do not have to claim all expenses. I never show a huge loss as far as what I sold and what I spent. The safe way to show loss is through mortgage interest and depreciation. The IRS doesn’t ding you for those those things when they look at your track record for profit or loss. You can show a loss for 4 years and then on the 5th year you show a small profit except for depreciation or mortgage interest and you won’t get dinged for being a hobby instead of a business. “How do I show a profit?” Simple don’t claim all of your expenses. Again, you MUST show all income but you do not have to deduct all expenses. I don’t depreciate my animals because it gets too muddy for me but you can. You can depreciate your buildings, fences, equipment including tractors and other vehicles used for farm use like ATVs, trailers, implements for the tractor, and so on. With new tax laws you can opt to take the expense off in one year instead of depreciating but unless you are trying to shelter a $100,000 profit it is better to set it up on a 5/7 year depreciation. Different items depreciate at different rates. We usually buy something big for the farm every year or so but for sure when something ages out of depreciation we add something else. Based on just income and costs I can show a profit and still have $10,000- $20,000 loss for the year from mortgage interest and depreciation. Again, I would not recommend trying to navigate this on Turbo tax. Set down with a tax professional especially if you are just starting this process. If you are going to file a schedule F go ahead and apply for a farm tax exemption with your state. Different states require you to file a schedule F for different amounts of time before you can do this so check your state for requirements.
For those that have never done it because you don’t want to keep up with receipts and such. There are apps that allow you to scan receipts and put them in categories. I don’t mess with that though. I can get a print out from the feed store, the vet, and see my transaction history from ADGA at the end of the year. For me that is more than enough to show a loss lol. If I needed more I could just go to my Amazon history.
If you have more questions please don’t ask me. Ask a professional. Even a fat tax refund won’t make up for the losses but it does give you a nice chunk of change in the spring to buy more goats 🤪