F-1 Cat. No. 24333E 1999 Instructions for Schedule F, Profit or Loss From Farming Use Schedule F (Form 1040) to report farm income and expenses. File it with Form 1040, 1041, 1065, or 1065-B. This activity may subject you to state and local taxes and other requirements such as business licenses and fees. Check with your state and local governments for more infor- mation. Additional Information. Pub. 225 has samples of filled-in forms and schedules, and lists important dates that apply to farmers. General Instructions Other Schedules and Forms You May Have To File Schedule E  to report rental income from pastureland that is based on a flat charge. Report this income in Part I of Schedule E. But report on line 10 of Schedule F pasture income received from taking care of some- one else’s livestock. Schedule J to figure your tax by averaging your farm income over the previous 3 years. Doing so may reduce your tax. Schedule SE to pay self-employment tax on income from any trade or business, includ- ing farming. Form 4562 to claim depreciation on assets placed in service in 1999, to claim amorti- zation that began in 1999, or to report in- formation   on   vehicles   and   other   listed property. Form 4684 to report a casualty or theft gain or loss involving farm business property in- cluding livestock held for draft, breeding, sport, or dairy purposes. See Pub. 225 for more information on how to report various farm losses, such as losses due to death of livestock or damage to crops or other farm property. Form 4797  to report sales, exchanges, or involuntary conversions (other than from a casualty or theft) of certain farm property. Also, use this form to report sales of live- stock held for draft, breeding, sport, or dairy purposes. Form 4835  to report rental income based on farm production or crop shares if you did not materially participate (for self- employment tax purposes) in the manage- ment or operation of the farm. This income is not subject to self-employment tax. See Pub. 225. Form 8824 to report like-kind exchanges. Heavy Highway Vehicle Use Tax If you use certain highway trucks, truck- trailers,   tractor-trailers,   or   buses   in   your trade or business, you may have to pay a Federal highway motor vehicle use tax. See Form 2290 to find out if you owe this tax. Information Returns You may have to file information returns for wages paid to employees, certain payments of fees and other nonemployee compensa- tion, interest, rents, royalties, annuities, and pensions. You may also have to file an in- formation return if you sold $5,000 or more of consumer products to a person on a buy- sell,  deposit-commission,  or  other  similar basis for resale. For more information, see the   1999   Instructions   for   Forms   1099, 1098, 5498, and W-2G. If you received cash of more than $10,000 in one or more related transactions in your farming   business,   you   may   have   to   file Form 8300. For details, see Pub. 1544. Estimated Tax If you had to make estimated tax payments in 1999 and you underpaid your estimated tax, you will not be charged a penalty if both of the following apply: 1. Your gross farming or fishing income for 1998 or 1999 is at least two-thirds of your gross income, and 2. You file your 1999 tax return and pay the tax due by March 1, 2000. For more details, see Pub. 225. Specific Instructions Filers of Forms 1041, 1065, and 1065-B Do not complete the block labeled  “Social security number (SSN).” Instead, enter your employer  identification  number  (EIN)  on line D. Lines A and B On line A, enter your principal crop or ac- tivity for the current year. On line B, enter one of the 14 principal agricultural activity codes listed in Part IV on page 2 of Schedule F. Select the code that best describes the source of most of your income. Line C Under the cash method, include all income in the year you actually get it. Generally, deduct expenses when you pay them. If you use the cash method, check the box labeled “Cash.”Complete Parts I and II of Schedule F. Under    the    accrual    method,    include income in the year you earn it. It does not matter when you get it. Deduct expenses when you incur them. If you use the accrual method, check the box labeled   “Accrual.” Complete Parts II, III, and line 11 of Sched- ule F. Other   rules   apply   that   determine   the timing  of  deductions  based  on  economic performance. See Pub. 538 for details. Farming syndicates cannot use the cash method of accounting. A farming syndicate may be a partnership, any other noncorpor- ate group, or an S corporation if: 1. The interests in the business have ever been for sale in a way that would require registration    with    any    Federal    or    state agency, or 2. More than 35% of the loss during any tax  year  is  shared  by  limited  partners  or limited entrepreneurs. A limited partner is one who can lose only the amount invested or required to be invested in the partnership. A  limited entrepreneur  is a person who does not take any active part in managing the business.