Budgeting is a crucial part of any successful business. If you’re just getting started with a small farm, it’s imperative to know what your expenses will be. Having the right game plan can be the deciding factor between success and failure. Knowing taxes, exemptions, farm fuel costs, and other factors all play into the equation. Use the following tips to get started.
Your Guide to Creating a Small Farm Budget
1. Create an Anticipated Income
An important part of budgeting is knowing how much you can potentially make. Start by knowing what you’ll produce and your expected yield. You can compare your operations with similar farms in your area and also use data from the United States Department of Agriculture. Check local market prices for goods and create a conservative anticipated income for the year. Account for reduced income during growing seasons and create long-term projects so you can budget month-to-month and year-to-year.
2. List Expenses
Once you know how much you’ll make, list your expenses. Begin with outstanding debts. If you took out a business loan or loans for equipment and land, these will need to be paid off before you profit. Move on to larger assets, like heavy machinery and farm equipment, then expenses like farm fuel and general maintenance. Consider the cost of labor, marketing, and transportation, and be aware of the different taxes you’ll face. It’s best to overestimate than underestimate at first so you have more wiggle room.
3. Know Your Exemptions
You should take advantage of money-saving opportunities every chance you get, so look into state and federal exemptions. You may qualify for farm fuel sales tax exemptions or refunds, property tax exemptions, or more. To ensure you don’t claim exemptions you don’t qualify for or claim too much for farm fuel refunds, it’s helpful to work with an accountant.
Whether you’re starting a farm or have an established operation, you’ll need a reliable farm fuel provider. Main Energy, a family owned and operated fuel and oil company in Palmyra, NY, is proud to offer high-quality products and delivery services to their clients. You can explore their services on their website. To schedule a fuel delivery, call (315) 597-5200 today.