Changes Made to the Agricultural Machinery and Equipment Tax Exemption

Important information from the Vermont Department of Taxes for Vermonters in the Ag Industry:

Act 100 of 2016 changed the exemption around agricultural machinery and equipment. The phrase “directly and exclusively” was changed to “predominately,” defined as 75% or more of the time the equipment is in use.

The exemption available to agricultural and horticultural entities for machinery and equipment is a use-based exemption. That means that items available under the exemption are only available as exempt if the purchaser will use the equipment 75% or more of the time for exempt uses. This declaration is made at the time of purchase by filling out Form S-3A, Agricultural Fertilizers, Pesticides, Supplies Machinery & Equipment.

For more information, please see the Department’s fact sheet on this topic, the Sales and Use Tax Regulations, and the FAQs on their website.

Also, please feel free to call our office in Williston (802) 878-1963 or Rutland (802) 775-7132 Vermont for more information.