2019 Tennessee Code
Title 67 - Taxes and Licenses
Chapter 6 - Sales and Use Taxes
Part 2 - Taxes Imposed
§ 67-6-207. Farm equipment and machinery.
(a) The sale at retail, lease, rental, use, consumption, distribution, repair, storage for use or consumption in this state of the following tangible personal property is specifically exempted from the tax imposed by this chapter when sold to a qualified farmer or nurseryman in accordance with subsection (e):
(1) Any appliance used directly and principally for the purpose of producing agricultural products, including nursery products, for sale and use or consumption off the premises, but excluding an automobile, truck, household appliances or property that becomes real property when erected or installed;
(2) Grain bins and attachments to grain bins;
(3) Aircraft designed and used for crop dusting, such as an agracat or other similar airplanes that are designed for crop dusting purposes;
(4) Equipment used exclusively for harvesting timber;
(5) Trailers used to transport livestock, as defined in § 44-18-101, farm products, nursery stock, or equipment, supplies, or products used in agriculture, as those terms are defined in § 43-1-113, or for other agricultural purposes relating to the operation and maintenance of a farm;
(6) Self-propelled fertilizer or chemical application equipment used to spread fertilizer or chemical on farms to aid in the production of food or fiber for human or animal consumption, notwithstanding the fact that the equipment may be mounted on a chassis with wheels, if the equipment is not designed for over-the-road use, but may be driven over-the-road from the source of supply to the farm, and tender beds and spreader beds, even if mounted on a truck chassis;
(7) Systems for poultry environment control, feeding and watering poultry and conveying eggs;
(8) Replacement parts or labor relative to the repair of the tangible personal property described in subdivisions (a)(1)-(7);
(9)
(A) Gasoline or diesel fuel used for agricultural purposes, as defined in § 67-6-102; except that premixed engine fuel containing gasoline and oil, produced for use in two-cycle engines and not for use in the propulsion of an aircraft, vessel or any other vehicle, that is sold in containers of one gallon (1 gal.) or less, is not exempt from the tax imposed by this chapter;
(B) For purposes of subdivision (a)(9)(A), “diesel fuel” means any petroleum distillate with at least twelve to sixteen (12-16) carbon atoms per molecule that has a boiling point of between three hundred fifty degrees Fahrenheit (350° F) and six hundred fifty degrees Fahrenheit (650° F) or any petroleum distillate that is ordinarily and customarily sold and used as a source of fuel for diesel engines;
(10) Seeds, seedlings, plants grown from seed and liners or cuttings that will produce food or fiber, including tobacco, for human or animal consumption;
(11) Fertilizer to be used to aid in the growth and development of seeds, seedlings or plants, as described in subdivision (a)(10);
(12)
(A) Pesticides that are sold for the purpose of aiding in the production of food or fiber, including tobacco, for human or animal consumption;
(B) As used in this section, “pesticide” means any substance or mixture of substances or chemicals intended for defoliating or desiccating plants or for preventing, destroying, repelling or mitigating any insects, rodents, fungi, bacteria or weeds, including, but not limited to, insecticides, fungicides, bactericides, herbicides, desiccants, defoliants, plant regulators and nematocides;
(13) Containers for farm products and plastic or canvas used in the care and raising of plants, seeds or seedlings, as described in subdivision (a)(10), and plastic or canvas used in covering feed bins, silos and other similar storage structures;
(14) Livestock and poultry feeds, drugs used for livestock and instruments used for the administration of the drugs;
(15) Any natural or artificial substance used in the reproduction of livestock, including semen or embryos;
(16) Adjuvants and surfactants solutions sold exclusively for the purpose of mixture with insecticides, pesticides, fungicides or herbicides or for use as a soil conditioner when the solutions are intended to aid in the growth and development of food or fiber, including tobacco, for human or animal consumption;
(17) Agri-sawdust;
(18) Water, electricity, natural gas, and liquefied gas, including, but not limited to, propane and butane, used directly in the production of food or fiber for human or animal consumption or to aid in the growing of a horticultural product for sale; and
(19) Coal, wood, wood products or wood byproducts, or fuel oil, which is used as energy fuel in the production of food or fiber for human or animal consumption or in production of nursery and greenhouse crops.
(b) Persons seeking to become qualified farmers or nurserymen shall apply to the commissioner for authority to make purchases exempt from tax. This application shall require information that the commissioner deems necessary. If the commissioner finds from the information that the applicant is entitled to be a qualified farmer or nurseryman, the commissioner shall issue a certificate granting the authority for a period of four (4) years, or until the applicant is no longer operating within the scope of its original application. Any misrepresentation made on the application by the applicant shall subject the applicant to any applicable tax, penalty and interest.
(c) Persons who have obtained authority from the commissioner to make purchases tax exempt as a qualified farmer or nurseryman shall provide their vendors with a copy of the certificate issued by the commissioner or a fully completed Streamlined Sales Tax certificate of exemption, which must include the exemption authorization number included on the certificate issued by the commissioner, to evidence qualification for the exemption.
(d) Persons making purchases exempt from tax under this section shall keep records to establish that the property qualifies for the exemption. The purchaser shall be liable for tax, penalty and interest for making nonqualifying purchases without payment of tax.
(e) For purposes of this section, “a qualified farmer or nurseryman” means a person who meets one (1) or more of the following criteria:
(1) The person is the owner or lessee of agricultural land from which one thousand dollars ($1,000) or more of agricultural products were produced and sold during the year, including payments from government sources;
(2) The person is in the business of providing for-hire custom agricultural services for the plowing, planting, harvesting, growing, raising or processing of agricultural products or for the maintenance of agricultural land;
(3) The person is the owner of land that qualifies for taxation under the Agricultural Forest and Open Space Land Act of 1976, compiled in chapter 5, part 10 of this title;
(4) The person's federal income tax return contains one (1) or more of the following:
(A) Business activity on IRS schedule F, profit or loss from farming; and
(B) Farm rental activity on IRS form 4835, farm rental income and expenses or schedule E, supplemental income and loss; and
(5) The person otherwise establishes to the satisfaction of the commissioner that the person is actively engaged in the business of raising, harvesting or otherwise producing agricultural commodities as defined in § 67-6-301(c)(2).
(f) Notwithstanding subsection (e) to the contrary, a person that qualifies as a manufacturer under § 67-6-206 shall not qualify as a farmer or nurseryman under this section.
