fotokostic / Depositphotos.com
The Minnesota Legislature has removed the funding cap on the Beginning Farmer Tax Credit for 2026 transactions. This means all eligible asset owner applications that are complete and submitted by required deadlines can be approved for this year only.
The Minnesota Department of Agriculture’s Rural Finance Authority began accepting applications for the 2026 Beginning Farmer Tax Credit on January 1, 2026. The credits were funded in a first-come, first-served basis, and initial funds ran out after the second day of applications.
A waitlist was created for those who have already applied, and those who have done so will be contacted via email in the coming weeks to confirm application approval. People who have not yet applied may submit lease applications by July 17, 2026, and applications for sales by Nov. 1, 2026.
This annual program is available to landlords and sellers (asset owners) who rent or sell farmland, equipment, livestock, and other agricultural assets to beginning farmers.
Both the asset owners and beginning farmers must submit applications with lease and/or sale documents to be eligible for funding. They may apply before sales close with a valid purchase agreement, if needed.
Asset owners can claim credits in one of the following categories in a given tax year for each beginning farmer they lease/sell to:
|
|
Tax Credit Amount |
Maximum Tax Credit |
Application Due Date |
|
Cash Rentals |
10% of annual rental income |
$7,000 |
July 17, 2026 |
|
Share Rentals |
15% of annual rental income |
$10,000 |
July 17, 2026 |
|
Sales |
8% of sale price (12% if the buyer is a Limited Land Access Farmer) |
$50,000 |
November 1, 2026 |
|
Beginning Farmer Farm Business Management Tuition Reimbursement |
Equal to tuition paid out of pocket |
$1,500 for 3 years |
November 1, 2026 |
Qualifying asset owners can include individuals, trusts, or qualified pass-through entities renting or selling land, livestock, facilities, buildings, or machinery used for farming in Minnesota to a beginning farmer. Parents, grandparents, and siblings are eligible for the tax credit if they sell farmland to a direct family member. However, this does not apply to leases or non-land sales (e.g., livestock, equipment).
A beginning farmer is defined as a Minnesota resident with the desire to start farming or who began farming within the past 10 years. They must provide positive projected earnings statements, have a net worth less than $1,069,000, and enroll in or have completed an approved Farm Business Management (FBM) program.
Beginning farmers are also eligible for a nonrefundable Minnesota tax credit equal to the amount paid for FBM tuition, up to a maximum of $1,500. This tax credit is available for up to three years.
Full eligibility requirements and other materials can be found on the Beginning Farmer Tax Credit webpage.
Minnesota Department of Agriculture
Comments