Working with a Farm Accountant

• accountant
• taxes
• planning

Why use an accountant who knows agriculture?

Farm returns involve rules that most small-business filers never meet: cash and accrual methods, inventory and livestock, crop insurance proceeds, farm-specific schedules and depreciation of buildings and machinery. IRS Publication 225 runs for many pages for good reason.

An accountant who works with farms every year already knows these rules and the questions lenders ask. That experience usually costs less in the long run than correcting avoidable mistakes.

None of this means you hand over responsibility. You still sign the return and you still need to understand the main numbers.

How do you find the right person?

Ask neighboring farmers, your lender, your extension office and local farm business associations for names. Ask each candidate how many farm clients they serve and what kinds of operations those are.

Meet at least two accountants before choosing. You are looking for someone who explains clearly, answers questions without making you feel foolish and communicates during the year, not only in March.

Credentials matter less than fit. Many good farm advisors are CPAs, and some are enrolled agents or accountants with long agricultural experience. Ask about their background and who will actually do your work.

• Number and type of farm clients
• Experience with your kind of operation
• Availability outside tax season
• Fees and how they are billed
• Comfort with your lender and attorney

What should you bring to the first meeting?

Bring several years of tax returns, your latest balance sheet if you have one, a list of loans with balances and payments, an equipment and land list, and your records for the current year. Bring a short list of what you want help with.

Be honest about the state of your books. An accountant can work with messy records, but only if they know what they are dealing with in advance, and extra cleanup work affects the fee.

If you are new to farming, add questions you do not know how to ask yet. A good accountant will help you figure out what you need to track from the first day.

What can an accountant do beyond the tax return?

Many accountants help with financial statements, cash flow projections, entity choice, payroll, estimated tax payments and multi-year tax planning. They can also review a business plan before you take it to a lender.

Ask which of these services are included and which cost extra. Clear expectations at the start prevent surprises later.

Some farms also use a bookkeeper for monthly entries and an accountant for year-end work. That split can reduce cost, as long as both know who is responsible for what.

How can you make the relationship work?

Send records on a regular schedule, quarterly if possible, so there is no mountain of paper in the spring. Tell your accountant about major purchases, sales, new enterprises or family changes before they happen, since timing can matter for taxes.

Ask questions in plain language and ask for explanations in writing when the topic is complicated. If something does not make sense, say so.

Keep a running list of questions through the year and send them in a batch. This respects the accountant's time and gets you better answers than a rushed call.

What questions should you ask?

Ask how fees are set, how fast they respond to questions, who prepares the work and who reviews it, and what happens if the IRS sends a notice. Ask how they handle records and keep your information secure.

Also ask what they need from you and by when, so you can plan your own year around their calendar.

Ask for an engagement letter that lists the services, fees and deadlines. A written scope protects both sides and avoids confusion if something goes wrong.

What mistakes do farmers make?

Frequent mistakes include waiting until the last week before the filing deadline, treating the accountant as only a form preparer, buying equipment late in the year without a conversation, and withholding information because of embarrassment.

Another is choosing only on price. A low fee that leaves you with missed planning opportunities or errors is not a bargain. This article offers concepts only and is not tax advice, so confirm everything with your own CPA.

If the relationship is not working, change. You can switch accountants, and a new one will request prior returns and records to get started.

Last reviewed: November 12, 2026. Written by the Farm Money & Grants Editorial Team. Educational only, not tax, legal or financial advice. See our editorial policy.