Common question about Farm Income/Expenses (Schedule F) for an S-Corporation return in Lacerte

Farm income/expenses are used to report items for the Schedule F on an S-Corporation Return. Refer to the following information to help with Screen 18, Farm Income/Expenses questions.

Principal Product

• Enter a description of the principal crop or output for the current year.
• This description will print on the Schedule F, Line A

General Information

Agriculture Activity Code from drop down

• Enter the agricultural activity code. Refer to the IRS instructions for Schedule F. Press [Ctrl]+[T] to access the agricultural activity code table, highlight the Agricultural Activity code number, and press [Enter]. This code prints at the top of Schedule F, line B.

Accounting Method

• Use this field to override the "Accounting Method" entered on Screen 1, Client Information. If you leave this field blank, and you entered "Other" in "Accounting Method," the program checks the "Cash" box on Schedule F.
• Enter 1 if the S corporation uses the cash method to report farm income.
• Enter 2 if the S corporation uses the accrual method to report farm income. The program checks the applicable box on Schedule F, line C.

Crop insurance proceeds election box

• Select the box (or enter 1) if the S corporation received crop insurance proceeds in 2024 and elected to include these proceeds in income in the year following the damage.
• If you make an entry, manually prepare a statement for the year the damage took place. If you use the cash method, the program checks the box on Schedule F, Part I, line 8c

Did not materially participate

• Select the box (or enter 1) if the S corporation received crop insurance proceeds in 2024 and elected to include these proceeds in income in the year following the damage.
• If you make an entry, manually, prepare a statement for the year the damage took place. If you use the cash method, the program checks the box on Schedule F, Part I, line 8c

Delete this year or delete next year

• Enter 1 to delete Schedule F from the current year tax if the activity is inactive and has no current year tax consequences.
• Enter 2 to delete Schedule F activity from the next year's return when processing proforma. The program doesn't re-number the remaining activities.

Farm Income

Cash Method

• Sales of livestock and other resale items
• Cost or basis of livestock or other resale items
• Sales of products raised

Accrual Method

• Sales of livestock and other resale items
• Beginning inventory of livestock, etc.
• Cost or basis of livestock, etc. purchased
• Ending inventory of livestock, etc.

Total cooperative distributions

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I. line 3a
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III. line 39a

Taxable cooperative distributions

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I. line 3b
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III. line 39b

Total agricultural program payments

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Taxable agricultural payments

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Commodity credit loans reported under election

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Total commodity credit loans forfeited or repaid

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Taxable commodity credit loans forfeited or repaid

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Total crop insurance proceeds received in 2024

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Taxable crop insurance proceeds received in 2024

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Taxable crop insurance proceeds deferred from 2023

• Enter the farm income in the applicable input fields. If the S corporation uses the cash method, the income items print on Schedule F, Part I.
• If the S corporation uses the accrual method, the income items print on Schedule F, Part III.

Custom hire (machine work) income

• Enter the custom hire (machine work).
• Starting in 2012, the taxpayer will be required to enter the custom hire (machine work) that was not already reported on line 7a, “Specified custom hire (machine work) income”. On Schedule F, income received through merchant card or third party networks should be entered on the lines marked for “specified” income.

Other income

Enter income amounts from other sources. These amounts include cash and check payments from:

• Illegal federal irrigation subsidies
• Bartering income
• Income from cancelation of debt
• State gasoline or fuel tax refunds received in 2024
• The amount of credit for biofuel claimed on Form 6478
• The amount of credit for biodiesel and renewable diesel fuels claimed on Form 8864
• The amount of credit for federal tax paid on fuels
• Any recapture of excess depreciation on any listed property
• The inclusion amount on leased listed property when the business use percentage drops to 50% or less
• Any recapture of the deduction for clean-fuel vehicles and clean-fuel vehicle refueling property
• Any income from breeding fees, or fees from renting teams, machinery, or land
• The gain or loss on the sale of commodity futures contracts if the contracts were made to protect the business from price changes

Farm Expenses

Amortization

• The program designates the following input fields as override fields: "Amortization" (the Depreciation Input Screen, code 52) and "Depreciation" (the Depreciation Input Screen, code 29). You can use the override codes in one of two ways:
• 1.  Enter the expense in the appropriate input field.
• -OR-
• 2.  Override the expense for depreciation and amortization that the program carries to the form from the Depreciation Input screen, and the Depreciation-Direct Input screen.
• The program carries the amount to Schedule L, Ending Accumulated Amortization and/or Depreciation.

Car and Truck Expenses through Veterinary,breeding and medicine expenses

• Enter the farm expenses incurred during the year in the appropriate input fields. These amounts print on Schedule F, Part II, lines 10 through 32.

Other Expenses

• Enter Schedule F expenses not included elsewhere. Enter the type of expense in the description. The program includes other expenses items on Schedule F, Part II, line 34. The program prints a supporting statement, when required. The program includes amortization and pre-productive period expenses (Section 263A) with other expenses on Schedule F.

Preproductive Period Expenses (also enter above)

• Capitalized preproductive period expenses; Enter the expense description and amount in full in "Other Expenses" (code 53). This amount prints as an adjustment on Schedule F, line 34 with the description "263A."

State Amounts (if different, -1 if none)

• Amortization
• Depreciation
• Taxes

• Entering Form 1099-PATR in Lacerte