How to Fill Out Schedule F for Your Farm: A Plain-English Guide
Schedule F is the IRS form farmers use to report their farm's income and expenses and calculate their net profit or loss for the year. It attaches to your Form 1040, and the net profit it produces flows into your income tax and your self-employment tax. The form itself isn't complicated once you understand what each line is asking for — the hard part is keeping your numbers organized through the year so filling it out is a matter of dropping in totals, not digging through a shoebox of receipts.
This guide walks through what Schedule F actually asks for, line by line in plain English, the mistakes that trip farmers up, and how to keep your records in a shape your CPA will thank you for.
What Schedule F is for
If you farm as a sole proprietor (or a single-member LLC), Schedule F is where your operation's finances get reported to the IRS. You list your farm income at the top, your expenses below, subtract one from the other, and the result is your net farm profit or loss. That number then drives two taxes: your regular income tax and your self-employment tax (Social Security and Medicare on your farm earnings).
Most farmers report on the cash method — you count income when you actually receive it and expenses when you actually pay them. That's the simpler approach and what the form assumes unless you've elected otherwise.
The income section (the top of the form)
Schedule F starts with everything that came in. The main lines:
Sales of livestock and items you bought for resale (Lines 1a–1c). This is for animals or items you purchased and then resold — like feeder cattle you bought to background and sell on. You report the sale price on Line 1a, subtract what you paid for them on Line 1b, and the difference (Line 1c) is your gross profit. Raised animals don't go here.
Sales of livestock, produce, grains, and products you raised (Line 2). This is the big one for most operations — your corn, beans, raised calves, market hogs, and anything else your farm produced and sold.
Cooperative distributions / patronage dividends (Line 3). Payments from co-ops, reported in two parts — the total received and the taxable amount.
Agricultural program payments (Line 4). ARC, PLC, and similar program payments.
CCC loans (Line 5). Commodity Credit Corporation loans, if you elect to report them as income.
Crop insurance proceeds (Line 6). Indemnity payments — with rules about which year you report them in, a choice worth confirming with your CPA.
Custom hire and other income (Lines 7–8). Custom work you did for others, and miscellaneous farm income.
These add up to your total gross income (Line 9).
The expense section (the longer part)
Below income, Schedule F lists your deductible farm expenses on lines 10 through 32. There are a lot of them, but they're just categories — your job is to put each dollar you spent into the right bucket. The main ones:
Car and truck expenses, chemicals, conservation expenses, custom hire, depreciation and Section 179, employee benefits, feed, fertilizer and lime, freight and trucking, fuel and oil, insurance (not health), mortgage interest, other interest, hired labor, pension and profit-sharing, equipment and land rent, repairs and maintenance, seed and plants, storage and warehousing, supplies, taxes, utilities, veterinary and breeding costs, and a catch-all "other expenses" line for things that don't fit the named categories (drying, soil testing, marketing checkoffs, licenses, legal and professional fees, and so on).
Add them all up and you get your total expenses (Line 33).
The bottom line
Net farm profit or loss (Line 34) = total income − total expenses. That single number is what matters most. If it's positive, it's added to your other income and taxed, and it's also subject to self-employment tax. If it's a loss, it may offset other income, subject to the rules around farm losses.
The mistakes that trip farmers up
A few things go wrong on Schedule F more than others:
Mixing raised and purchased livestock. Animals you raised go on Line 2; animals you bought to resell go on Lines 1a–1c. Putting them in the wrong place misstates your income.
Forgetting non-cash and "paper" income. Co-op dividends, program payments, and crop insurance proceeds are income even though they don't feel like a typical sale.
Lumping everything into "other." The catch-all line is for genuine miscellany. Putting fertilizer or feed there instead of its own line makes your return look odd and can raise questions.
Losing track of the small stuff all year. The single biggest source of pain isn't the form — it's reconstructing a year's worth of expenses at tax time from memory and a drawer of receipts. Money spent that you can't document is hard to claim.
Forgetting self-employment tax. Your net profit isn't just hit by income tax — it's also subject to roughly 15.3% self-employment tax. Farmers who plan only for income tax can get a surprise.
The real key: organize as you go, not at tax time
Here's the honest truth about Schedule F: the form is straightforward, but it's only easy if your numbers are organized before you sit down to file. The farmers who dread tax season are the ones reconstructing twelve months of activity from a shoebox. The farmers who breeze through it are the ones who logged income and expenses into the right categories as the year went along — so at tax time, every Schedule F line is already totaled.
That's exactly what a good tracking spreadsheet does for you.
Let a tracker do the sorting
The Schedule F & 1099 Tracker from Farm Wife Financials is built to take the work out of this. You log each income and expense entry as it happens and pick its category from a dropdown — and the tool totals everything by the Schedule F line that category maps to. When tax time comes, you hand your CPA a Schedule F Summary with each line already added up, instead of a pile of receipts.
It's organized around the IRS form — purchased and raised livestock kept on separate lines, the expense categories grouped to their lines, an "other expenses" breakdown, and a self-employment tax estimate. It also includes a 1099 tracker to help you keep track of which contractors you may need to issue a 1099 to, based on the current reporting threshold.
You buy it once and own it forever — it opens in Excel, no subscription, no login. Built by someone with a background in financial analysis who also raises cattle and row crops in Iowa, so it's made for how farms actually keep books.
See the Schedule F & 1099 Tracker →
Farm Wife Financials provides spreadsheet tools for informational and educational purposes only. This article is general information, not tax, legal, or accounting advice, and Farm Wife Financials is not a CPA. Tax rules change and individual situations vary — verify all figures and consult a qualified tax professional before filing.