Form Pub. Ks-1525 - Kansas Sales & Use Tax For Contractors Subcontracotrs & Repairmen Page 19
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49of an irrigation system that are considered to be farm
FARM, RANCH AND FEED LOT PROJECTS
machinery and equipment are exempt if purchased for
farm use (i.e., none of the water pumped is used for
human consumption and/or sanitation, or any other
General Rule
nonagricultural use). Labor services to assemble or
repair irrigation equipment for farm use are also not
The materials used to construct and repair buildings
subject to sales tax.
and other structures for farmers, ranchers and feed
lots are subject to sales tax when purchased by either
The following are representative, but not exclusive,
a contractor or farmer/rancher/feed lot. As a general
lists of exempt and taxable irrigation and well-related
rule the labor services to repair or maintain an existing
items:
farm building, well or feedlot are taxable. As discussed
earlier in the Original Construction section, the labor
E
I
E
: Pivot system, heat
XEMPT
RRIGATION
QUIPMENT
services to construct a new building or facility (feedlot
exchanger, flowmeter, gear drive, bowl units, column
or well) are not subject to sales tax. Furthermore the
pipe, tubing and shaft assembly, check valve, and the
definition of original construction also includes the labor
discharge head, as well as submersible pumps and
to repair damage from a fire, flood, tornado, lightening,
motors, gate and check valves and drop pipe.
explosion, windstorm, ice loading and attendant winds,
terrorism, or earthquake. A windstorm means straight
The repair parts (including tires) and labor to install,
line winds of at least 80 miles per hour as determined
repair or maintain these exempt components of irrigation
by a recognized meteorological reporting agency or
equipment are also exempt from sales or use tax.
organization.
T
: The cement base, underground
AXABLE MATERIALS
Grain Storage
discharge pipe, and underground plastic PVC irrigation
pipe, along with the pressure tank, galvanized nipples
Grain storage bins are farm buildings (improvements
and fittings, well pits and lids, well seals, and pitless
to real property). Like any other existing commercial
units and/or adapters. The labor to repair a taxable item
building, the materials to build it are taxable, as are the
is also taxable.
labor services to repair or modify it.
Any labor services performed in or on irrigation wells
However, a grain bin may house exempt farm
are subject to sales tax, unless the service of installing
machinery and equipment. Equipment such as augers
or applying tangible personal property is in connection
and blowers used to manage the extended storage of
with the original construction of the irrigation well. Original
the grain are exempt as farm machinery and equipment.
construction might be either the first or initial construction
of the well, or the reconstruction or repair of a well
You are building a new grain storage bin.
damaged by fire, flood, tornado, lightening, explosion,
The structural materials that make up the
windstorm, ice loading and attendant winds, terrorism,
bin (corrugated siding, anchor bolts,
or earthquake. A windstorm means straight line winds
access doors, foundations, ladders, roof
of at least 80 miles per hour as determined by a
and vents) are subject to sales tax. The grain storage
recognized meteorological reporting agency or
bin accessories, such as augers, electric control panels,
organization.
fans, stirring devices and spreaders, are exempt as farm
machinery and equipment. The labor services to build
Farm Machinery and Equipment
the bin are not taxed since this is an original construction
bin (building).
There is an exemption for farm or aquaculture
machinery and equipment. The exemption is for the
Portable Grain Bins
purchase of the equipment, any repair parts and for
the labor performed thereon. This exemption is limited
Portable bins mounted on wheels or work bins that
to farm or aquaculture machinery and equipment that
are intended to be frequently moved along with wheel-
is used only in farming, ranching, the operation of a
mounted grain augers, dryers or other portable grain
feedlot or nursery, farm or ranch work for hire, or
handling equipment are exempt as farm machinery and
aquaculture. EXEMPT: Combines, tractors, discs,
equipment. A tarp used to cover the top of an
harrows, hay balers, irrigation and milking equipment,
agricultural gravity or hopper box is also exempt.
planters, plows, tillers and work-site utility vehicles.
TAXABLE: Air compressors and tanks, ATVs,
Irrigation Equipment
automobiles and trucks, barn ventilators, building and
electrical materials, bulldozers, fencing materials and
Irrigation equipment has two components for sales
tools, garden hoses, grain bins, hand tools,
tax purposes – the parts that are exempt from sales tax
lawnmowers, silos, water and gas wells, welding
as farm machinery and equipment; and the items that
equipment and any equipment that becomes part of a
are improvements to real property (taxable). The parts
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