Incentives available for farm machinery purchases

The government's well-publicized "cash-for-clunkers" program may be great for the purchase of a new pickup, but many farmers may not realize there currently are some key incentives for the purchase of farm machinery.

Published on: Aug 5, 2009
Most farmers probably are well aware of the government's well publicized cash-for-clunkers program that may be used to trade in an old pickup truck.

But many farmers may not be aware that now may be as good of time as any, for those in good financial standing, to buy that new tractor or combine.

Current incentives, such as expense method depreciation and 50 percent "bonus" depreciation, may decline or even expire after 2009, according to Neil Harl, a retired ag economist from Iowa State University.

"For those in good financial position, this is a good time to take a close look at expenditures you want to make," Harl told FarmWeekNow.com. "There are more incentives to buy equipment than a lot of people realize."

Meanwhile, many retailers are offering addtional rebates/discounts to spur purchases during the economic downturn. The result is it's a buyers' market for those who can afford it.

"There are deals you can get that would have been unheard of a year ago," Harl said.

The key to take advantage of current incentives for farm equipment is to make sure the machinery is placed into service in 2009, he added. Otherwise some of the incentives may not be applicable.

We have audio with Neil Harl, plus a link to a online calculator that can determine the approximate value of any bonus depreciation.

Online depreciation calculator