SPRING HILL, Tenn. – A new publication available through University of Tennessee Extension promises to help the state’s farmers wade through the mire that can be state taxation laws and regulations. 
The text, titled Sales Tax in Tennessee on the Purchase and Sale of Farm Products (UT Extension publication number PB 1806), can assist agritourism operators and farmers who market products directly to retail outlets and the public. “Tennessee farmers and nursery operators encounter sales and use tax issues both as purchasers and sellers of various products,” said the publication’s author Hal Pepper, a financial analysis specialist with the UT Center for Profitable Agriculture. “It is important for farmers to understand how sales tax rules apply to both their purchases and sales,” he said.

Pepper explains that certain sales of farm products may be exempt from sales tax and that this publication explains when those exemptions apply. It also deals with the issue of registering with the Tennessee Department of Revenue and remitting sales tax when there are taxable sales.
“Sales tax issues are often confusing, complex and tedious to understand and interpret,” Pepper said. The expert uses the publication to present some general issues and examples that help in the understanding of when and how sales tax may apply to sales and purchases. “There are also specific issues, circumstances, exceptions and exemptions that should be carefully considered,” he said.
As it relates to improving the understanding of sales tax for Tennessee farmers, Pepper explains that the publication is intended to address three main points:
1.      Identify and explain sales tax rules and exemptions that apply to sales made by farmers.
2.      Describe when sales tax is due, rates that apply, how to get registered and how to document tax-exempt purchases.
3.      Provide information about sales tax implications for value-added farm products and agritourism operations.

The publication is available free of charge online at this address:
Alternatively, you may contact your local county UT Extension office or the Center for Profitable Agriculture. 
The UT Center for Profitable Agriculture is a joint effort of UT Extension and the Tennessee Farm Bureau Federation. The center supports the efforts of the Tennessee Department of Agriculture.

UT Extension provides a gateway to the University of Tennessee as the outreach unit of the Institute of Agriculture. With an office in every Tennessee county, UT Extension delivers educational programs and research-based information to citizens throughout the state. In cooperation with Tennessee State University, UT Extension works with farmers, families, youth and communities to improve lives by addressing problems and issues at the local, state and national levels.

Hal Pepper, Financial Analysis Specialist, Center for Profitable Agriculture, 931-486-2777