- live in Colorado;
- have a net worth of less than $2 million;
- be responsible for the majority of the labor on and management of the leased agricultural asset the majority of the time;
- have plans to farm or ranch full-time;
- have less than 10 years of experience in farming or ranching;
- have some prior farming or ranching experience or education; and
- participate in a financial management educational program approved by the Colorado Agricultural Development Authority.
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Reading Time: 3 minutesColorado—Income Tax: Deduction Created for Leasing Out Agricultural Assets Colorado Gov. John Hickenlooper has signed legislation creating a corporate and personal Colorado income tax deduction for taxpayers that lease an agricultural asset, which is defined as “land, crops, livestock, livestock facilities, farm equipment, grain storage, or irrigation equipment,” to a beginning farmer or rancher satisfying certain qualifications. The deduction is equal to 20% of the lease payment received from the beginning farmer or rancher for a lease of agricultural assets with a term of at least three years and is available for tax years beginning after 2017 and before 2020. Under the legislation, more than one deduction certificate may be issued to a qualified taxpayer, except that the deductions are capped at $25,000 per taxpayer, per year. In order for the lessor to receive a deduction, the beginning farmer or rancher lessee must: