Hidden Tax Advantages of Investing in Farmland
The stability of farmland, its consistent increase in value, and diversification of investment portfolios have long been known as the benefits of investing in farmland. Despite the economic and agricultural advantages, few investors understand the often overlooked but significant tax advantages of investing in farmland. Such advantages can considerably improve overall returns and provide savvy investors with an effective strategy for wealth preservation.
Let’s examine why investing in farmland is rare yet a wise choice.
1. Depreciation offers advantages for allied infrastructure and its trustees.
You may claim the value of depreciation on investments such as fences, borewells, storage sheds or solar pumps on your farm as long as you use them for business activities. Even though the land won’t become less valuable, you can treat the buildings on it as assets for tax purposes.
2. Lease Income from Farmland
For many investors, giving local farmers rental access to their land provides a regular source of money. In most circumstances, because farm leasing is considered agricultural activity, the income is not taxed which provides another advantage.
3. Conservation Easements
Investors also use conservation easements to support their farmland goals. When investing in farmland, placing a conservation easement on the property helps protect its environment or agricultural function. Donating the easement can lead to tax deductions from the resulting decrease in land value. Since easements lower the farm’s taxable value, they also make it easier for heirs to inherit without tax hassles.
4. A section 179 deduction is a tax loophole available to businesses.
Section 179 provides an important benefit to farmland investors who make big purchases. By taking this benefit, an investor can subtract the entire cost of certain equipment and property upgrades from their income in the year they are bought, not over several successive years. Farming expenses that qualify are tractors, systems for watering crops and grain storage facilities. This may allow farms making large investments to reduce the tax they owe a lot, leading to substantial savings.
Invest Smart with Lake View Farms
For those who want to use the tax benefits while owning top farmland close to Bangalore, LakeView Farms is the right choice. LakeView Farms helps you to earn tax-free money, grow your assets in the long run and live a sustainable investment life by having lawfully certified agricultural plots in beautiful natural sites.
Whether you're a seasoned investor or just beginning your journey, investing in farmland through LakeView Farms is not just financially wise—it’s future-ready.
Own your slice of nature and prosperity with LakeView Farms today!
