Kentucky Selling Farmer Tax Credit
Did you know that Kentucky offers a tax credit for landowners who sell farmland to active farmers? The Kentucky Selling Farmer Tax Credit provides an incentive for a farmland owner to keep their agricultural land in production. In 2025, the Kentucky legislature approved changes to the credit to increase the incentive and expand the farmland owners who would be eligible for the credit.
What’s the credit worth?
Up to 5% of the selling price of the agricultural assets with an annual cap of…
$50,000 for a sale to a beginning farmer
$25,000 for a sale to any active farmer
How do I get the credit?
Both the seller and the buyer submit a simple application and then provide documentation to confirm the details of the sale. These must be completed within one year of the sale, but it would be a good idea to apply for the credit in the same calendar year of the sale to be able to apply it to the sale proceeds.
Where can I find out more?
Guidelines and applications for the credit can be found here. The Cabinet for Economic Development can answer questions you have and help you with the process. If you need more information, you can also reach out to the Kentucky Farmland Transition Initiative at 502-653-2787.
We want to hear from you. Whether you are a farmer navigating a farm transition, a young farmer starting out, an attorney or CPA working with farmers, or you just care about Kentucky farmers losing access to farmland, the Kentucky Farmland Transition Initiative wants to hear your story and understand the issues you face. Click on Get Involved and let’s figure out the solution together.