Farming Purposes A credit or refund may be allowed for the excise tax on fuel usedon a farm for farming purposes. Farm.A farm includes livestock, dairy, fish, poultry, fruit, fur-bearinganimals, and truck farms, orchards, plantations, ranches, nurseries,ranges, and feed yards for fattening cattle. It also includesstructures such as greenhouses used primarily for the raising ofagricultural or horticultural commodities. A fish farm is an areawhere fish are grown or raised -- not merely caught or harvested.The farm must be operated for profit. It must be located in any of the50 states or the District of Columbia. Farming purposes.As the owner, tenant, or operator, you use fuel on a farm forfarming purposes if you use it in any of the following ways. To cultivate the soil or to raise or harvest anyagricultural or horticultural commodity. To raise, shear, feed, care for, train, or manage livestock,bees, poultry, fur-bearing animals, or wildlife. To operate, manage, conserve, improve, or maintain yourfarm, tools, or equipment. To handle, dry, pack, grade, or store any raw agriculturalor horticultural commodity. For this use to qualify, you must haveproduced more than half the commodity that was so treated during thetax year. Commodity means a single raw product. For example, applesand peaches are two separate commodities. To plant, cultivate, care for, or cut trees or to prepare(other than sawing logs into lumber, chipping or other milling) treesfor market, but only if the planting, etc., is incidental to yourfarming operations. Your tree operations will be incidental only ifthey are minor in nature when compared to the total farmingoperations. If any other person, such as a neighbor or custom operator,performs a service for any of the purposes listed in (1) or (2) foryou on your farm, you are considered to be the person that used thefuel on a farm for farming purposes. However, see Customapplication of fertilizer and pesticide, later. If doubt exists whether the owner, the tenant, or the operator ofthe farm bought the fuel, determine who bore the cost of the fuel. Forexample, if the owner of a farm and the tenant share the cost ofgasoline 50-50, each can claim a credit for the tax on one-halfof the fuel used. Custom application of fertilizer and pesticide.The use of fuel in the aerial or other application of fertilizer,pesticides, or other substances is a use of fuel on a farm for farmingpurposes. You, as the owner, tenant, or operator, are treated as theultimate purchaser of the fuel. However, you may waive your right tobe treated as the ultimate purchaser. If you waive your right, theapplicator is treated as having used the fuel on a farm for farmingpurposes. Waiver.To waive your right to be treated as the ultimate purchaser, youmust take all the following actions. Before the applicator files his or her claim, execute inwriting an irrevocable statement that you knowingly give up your rightto the credit or refund. You may authorize an agent, such as acooperative, to sign the waiver for you. Identify clearly the period that the waiver covers. Theeffective period of your waiver cannot extend beyond the last day ofyour tax year. The applicator must retain a copy of the waiver and give youa copy. Do not send a copy to the Internal Revenue Serviceunless requested to do so. The waiver may be a separate document or it may appear on aninvoice or another document from the applicator. If the waiver appearson an invoice or other document, it must be printed in a sectionclearly set off from all other material, and it must be printed intype sufficiently large to put you on notice that you are waiving yourright to the credit or refund. If the waiver appears as part of aninvoice or other document, it must be signed separately from any otheritem that requires your signature. Sign a separate waiver for each tax year or part of a tax year inwhich the fuel was used. When the period covered by the waiver extendsbeyond the applicator's tax year, the applicator must wait until thenext tax year to claim the portion for that period. Fuel not used for farming.You do not use fuel on a farm for farming purposes when you use itin any of the following ways. Off the farm, such as on the highway or in noncommercialaviation, even if the fuel is used in transporting livestock, feed,crops, or equipment. For personal use, such as mowing the lawn. In processing, packaging, freezing, or canningoperations. In processing crude gum into gum spirits of turpentine orgum resin or in processing maple sap into maple syrup or maplesugar.