# Texas AG/Timber



## randm (May 24, 2013)

For someone that is starting to raise beef cattle, is it a good idea to register for a Texas AG/Timber Sales and Use Tax exemption? Is it worth the extra paperwork, I keep all receipts and records of everything I buy for the "farm". If I register a DBA, then I will have to file income taxes for the business, for someone just getting started is it worth it? My wife and I will still work a full time job outside of raising cattle. I guess I am asking for the advantages and disadvantages of the situation and give me a quick run down. Thanks for any information.


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## Michael W. Smith (Jun 2, 2002)

Yes, I would say it's worth it - at least at first. 

You don't have to pay for sales tax on feed and such and when you file your taxes, it should help save you money because chances are the expenses are going to be bigger the first couple of years than the "profits". 

The only problem might be if you get audited for taxes and the government determines your business is more of a hobby than actually a business.

But, if you actually run it as a business and keep good records, they can't say much.

And if in the future you actually start to have a profit - you can always "shut down the business" and pay sales tax and not file farm taxes.


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