Schedule F, Profit or Loss From Farming, is filed with Form 1040 by sole proprietors and certain other taxpayers engaged in farming. It reports income from sales of crops and livestock, program payments, and other farm income, as well as deductible farm expenses. Farm entities such as partnerships and corporations report on their own returns instead.
Farm tax rules include special provisions on items such as estimated taxes, income averaging, and the timing of income and expenses. Because the rules are specialized, farmers usually work with an adviser who knows agriculture, and clean year-round records make that work easier.