Schedule F (Form 1040) 2018: Farm Profit or Loss

Schedule F (Form 1040) is the federal tax schedule used by sole proprietor farmers and ranchers to report farming profit or loss for the tax year 2018. It is filed alongside Form 1040, Form 1040NR, Form 1041, or Form 1065, depending on entity type.

Late Filers

Farmers who missed the 2018 deadline can still submit Schedule F to stop the failure-to-file penalty and establish a compliance record with the IRS.

Multiple Income Sources

Schedule F accommodates multiple 2018 farm income types — including livestock sales, cooperative distributions, crop insurance proceeds, and custom hire income — on one schedule.

Itemizing Deductions

Farm operators may deduct ordinary and necessary 2018 business expenses, including feed, fertilizers, chemicals, labor, and depreciation, directly on Schedule F Part II.

Claiming 2018 Credits

Farmers who received a federal fuel tax credit or refund in 2018 report it as other income on Schedule F line 8. [2018 Only]

IRS Compliance

Filing Schedule F establishes an IRS compliance record that the agency may require before approving a payment plan or resolving any outstanding 2018 balance.

Citizens Abroad / Military

U.S. citizens or military members with 2018 farming income abroad may be required to file Schedule F and report all worldwide farm income.

Follow the steps below to accurately complete your 2018 Schedule F; note that steps 3, 5, and 6 include rules and line numbers specific to this tax year.

1. Gather Your Documents Before Starting

Collect 2018 farm income and expense records before starting, including Form(s) 1099-PATR, agricultural program payment notices, crop insurance statements, and Form 4562 for depreciation. If originals are missing, use IRS Get Transcript Online to retrieve wage and income records.

2. Choose the Correct Filing Status [2018 Only]

Schedule F is filed with Form 1040, Form 1040NR, Form 1041, or Form 1065. In Item C, check cash or accrual as the accounting method. Cash-method filers complete Parts I and II only; accrual-method filers must also complete Part III. For 2018, Schedule C-EZ remained available for non-farm self-employment, but does not apply to farm income on Schedule F.

3. Report All Income on the Correct Lines [2018 Only]

Report purchased livestock on line 1a, raised livestock and crops on line 2, cooperative distributions on lines 3a–3b, program payments on lines 4a–4b, CCC loans on lines 5a–5c, crop insurance on lines 6a–6b, custom hire on line 7, fuel credits on line 8. For 2018, crop insurance may be deferred to 2019 by attaching the election and checking box 6c.

4. Calculate Adjusted Gross Income (AGI)

Sum lines 1c, 2, 3b, 4b, 5a, 5c, 6b, 6d, 7, and 8 for gross farm income on line 9; accrual-method filers use Part III line 50. Subtract line 33 expenses for net profit or loss on line 34. The result transfers to Schedule 1 and is subject to self-employment tax on Schedule SE.

5. Choose Your Deductions and Apply Exemptions [2018 Only]

Deductible 2018 farm expenses on Part II, lines 10–32f, include chemicals, conservation expenses, depreciation, employee benefits, feed, fertilizers, freight, fuel, insurance, interest, labor, pension plans, rent, repairs, seeds, storage, supplies, taxes, utilities, and veterinary costs. For 2018, eligible self-employed farmers may also claim a 20% qualified business income deduction on Form 1040, not on Schedule F. [2018 Only]

6. Claim the 2018 Fuel Tax Credit [2018 Only]

Farmers who paid federal excise taxes on farm fuel in 2018 report the credit on line 8 and claim the offset on Form 4136, attached to Form 1040. Per-gallon rates are in the 2018 Form 4136 instructions.

Missing Schedule F (Form 1040) or Tax Records for 2018?

Late filers often lack original 2018 income documents, but IRS and Social Security Administration records can help reconstruct what is needed to complete an accurate farm return. Always use official transcripts rather than estimated figures for any late 2018 filing.

IRS Wage & Income Transcript

This free transcript lists all 2018 income reported to the IRS by employers, cooperatives, and financial institutions, and is available online at IRS.gov or by mail using Form 4506-T.

IRS Account Transcript

The IRS account transcript shows estimated tax payments received, penalties assessed, and account adjustments for 2018, making it useful for reconciling discrepancies or confirming whether prior payments were properly credited.

Social Security Administration

The Social Security Administration can provide 2018 wage records for any farm employee if a W-2 was lost or never issued by the agricultural employer or labor contractor.

Contact Prior Employers

If a 1099-PATR, 1099-G, or other 2018 document is missing, contact the cooperative, agency, or institution that issued it to request a duplicate or confirmation of the reported amount.

Do not estimate any income figures on Schedule F; use IRS transcripts to match reported amounts and reduce follow-up notices from the Internal Revenue Service.

These are the most frequent errors causing IRS delays, rejected returns, or missed credits on 2018 farm returns.

• Using the wrong tax year form — Submitting any non-2018 Schedule F causes automatic rejection; use the official 2018 form from the IRS website or the Individual and Fiduciary Prior Year Forms webpage.
  
  
• Missing the 2018 fuel tax credit — Omitting the fuel tax credit from line 8 and failing to attach Form 4136 permanently forfeits the credit for 2018 farm fuel costs. [2018 Only]
  
  
• Wrong accounting method selected — Checking the wrong box in Item C causes filers to complete the incorrect parts of Schedule F and misstate gross farm income on line 9.
  
  
• Applying crop insurance deferral incorrectly — Without the required election statement attached, 2018 crop insurance proceeds cannot be deferred; reporting them as deferred will trigger an IRS adjustment.
  
  
• Treating CCC loans as non-taxable — Farmers who made the CCC election must include loan proceeds on line 5a; omitting them understates gross farm income for the 2018 tax year.
  
  
• Assuming a refund is still available — The 2018 refund deadline passed April 15, 2022; any unclaimed refund is permanently forfeited and cannot be recovered through any IRS process.
  
  
• Missing or incorrect Social Security numbers — An incorrect SSN or EIN on Schedule F causes the IRS to reject or mispost the return and delays any resolution of the account.
  
  
• Unsigned return — A 2018 Form 1040 submitted without the required taxpayer signature is invalid and will not be processed until a properly signed return is received.
  
  
• Missing attachments — Omitting Form 4562 for depreciation, Form 4136 for the fuel credit, or Form 4797 for breeding livestock sales causes the IRS to disallow claimed deductions.
  

What is IRS Schedule F (Form 1040) (2018) used for?

Schedule F (Form 1040) is used by sole proprietors to report 2018 farming profit or loss to the IRS. The net result is reported on Form 1040 and is subject to self-employment tax on IRS Form 1040 Schedule SE, a required component of individual income tax returns for any farming operation.

Can I still file a 2018 Schedule F tax return?

Yes, a 2018 Schedule F can still be filed on paper, since IRS e-file no longer accepts prior-year returns. Filing now stops the failure-to-file penalty immediately. The refund window for 2018 closed April 15, 2022; however, so any overpayment can no longer be recovered from the IRS.

Who is required to file Schedule F (Form 1040) for 2018?

Any sole proprietor who operated a farming business and received income or sustained a loss in 2018 is required to file Schedule F. Partners in farming partnerships attach it to Form 1065; fiduciaries attach it to Form 1041, provided farming income arose from the applicable entity.

What is the difference between the cash and accrual methods on Schedule F?

Cash-method farmers report income when received and expenses when paid, completing only Parts I and II. Accrual-method farmers report income when earned and expenses when incurred, completing Part III as well. The accounting method checked in Item C determines which parts of Schedule F are required.

What farm expenses are deductible on the 2018 Schedule F?

Deductible 2018 expenses on Schedule F Part II include chemicals, conservation expenses, depreciation, employee benefits, feed, fertilizers, freight, fuel, insurance, interest, hired labor, pension plans, rent, repairs, seeds, storage, supplies, taxes, utilities, and veterinary costs, plus other ordinary expenses on lines 32a through 32f.

How does Schedule F farm income affect self-employment tax?

Net farm profit from Schedule F is subject to self-employment tax calculated on IRS Form 1040 Schedule SE. For 2018, the rate was 15.3% on income up to $128,400 and 2.9% above that. Half of the self-employment tax paid is deductible as an above-the-line adjustment, reducing adjusted gross income.

What income types do not belong on Schedule F?

Income from agricultural services provided for a fee — soil preparation, farm management, or veterinary work — belongs on Schedule C, not Schedule F. Income from breeding or caring for pets also goes on Schedule C. Livestock held for breeding, draft, sport, or dairy is reported on Form 4797.

How do I get the missing 2018 farm income documents?

Request missing 2018 records through IRS Get Transcript Online at IRS.gov or by mail using Form 4506-T. The wage and income transcript lists all income reported by cooperatives and financial institutions. For missing W-2s, contact the Social Security Administration or the prior employer to request a duplicate.