[Editors: This story will not be valid after March 2]

Agricultural producers have until March 2, 2026, to file their 2025 income tax returns without penalty if they have not made estimates.

“Producers have until April 15 to file without penalty if they paid their estimated tax by Jan. 15,” says Ron Haugen, North Dakota State University Extension farm economist.

Haugen notes many new tax provisions for 2025 tax preparation:

• The standard deduction is $31,500 for those who are married and filing jointly and $15,750 for singles.
• The Social Security wage base for 2025 is $176,100.
• The standard mileage rate for 2025 is 70 cents per mile.
• Agricultural producers are allowed to use 200% declining balance depreciation for 3-year, 5-year, 7-year and 10-year property. The 150% declining balance method still is required for 15-year and 20-year property.
• For most new agricultural machinery and equipment (except grain bins), the recovery period is five years.
• Like-kind exchanges are not allowed for personal property but are allowed for real property.
• The Section 179 expense allows producers to deduct up to $2.5 million on new or used machinery or equipment purchased in the tax year. There is a dollar-for-dollar phase-out for purchases above $4 million.
• The additional first-year bonus depreciation has been reinstated to 100% after Jan. 19, 2025. It is available for used and new property.
• Income averaging can be used by producers to spread the tax liability to lower income tax brackets in the three previous years. This is done on Schedule J. North Dakota farmers who elect to use income averaging for federal purposes also may use Form ND-1FA, which is income averaging for North Dakota income tax calculations.
• Crop insurance proceeds and government crop disaster payments can be deferred to the next tax year if a producer is a cash-basis taxpayer and can show that normally income from damaged crops would be included in a tax year following the year of the damage.
• A livestock income deferral is available for those who had a forced sale of livestock because of a weather-related disaster. The IRS has two provisions for deferral. The first one is IRC 1033(e), which allows a livestock producer who sells more draft, breeding or dairy animals than usual due to weather-related conditions to defer recognition of the gains for up to two years (or four years if there is a federal disaster declaration). The second provision is IRC 451(g), which allows a livestock producer who uses the cash method of accounting to elect to defer for one tax year the income of any qualified livestock sold due to weather-related conditions.

Information on agricultural tax topics can be found in the IRS’ Publication 225, “Farmer’s Tax Guide.” It is available at any IRS office or can be ordered by calling 800-829-3676.

Any questions about these topics or further updates should be addressed to a tax professional or the IRS at 800-829-1040 or https://www.irs.gov.

For questions about North Dakota income tax, call the North Dakota Tax Department at 877-328-7088 or go to http://www.nd.gov/tax.

NDSU Agriculture Communication – Feb. 2, 2026

Source: Ron Haugen, 701-231-8103, ronald.haugen@ndsu.edu

Editor: Dominic Erickson, 701-231-5546, dominic.erickson@ndsu.edu