Tax 11.12(3)(3) Obtaining exemption certificates. A retailer shall have a signed exemption certificate for every exempt sale made to a farmer, except that if the exemption certificate is received electronically, a signature is not required. Every invoice to which the certificate refers must contain the seller’s name, the farmer’s name and address, the date of sale and a brief description of the product sold.

Tax 11.12(4)(a)(a) Section 77.54 (3) (a), Stats., exempts the sales price from the sales of and the storage, use, or other consumption of tractors and machines, including accessories, attachments, and parts, lubricants, nonpowered equipment, and other tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., that are used exclusively and directly, or are consumed or lose their identities, in the business of farming, including dairy farming, agriculture, horticulture, floriculture, silviculture, beekeeping, and custom farming services, but excluding automobiles, trucks, and other motor vehicles for highway use; excluding personal property that is attached to, fastened to, connected to or built into real property or that becomes an addition to, component of or capital improvement of real property and excluding tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., used or consumed in the erection of buildings or in the alteration, repair, or improvement of real property, regardless of any contribution that that personal property, or item or property under s. 77.52 (1) (b) or (c), Stats., makes to the production process in that building or real property and regardless of the extent to which that personal property, or item or property under s. 77.52 (1) (b) or (c), Stats., functions as a machine, except as provided in subd. 4. d. For purposes of this section:

Tax 11.12(4)(a)1.1. ‘Directly.’ Items used “directly” in farming include a plow, a combine, and a milking machine. Items of “indirect” use include repair tools, computers used for tracking prices or inventories or for word processing, and lawn and garden tractors used for mowing lawns and tilling home gardens.

Tax 11.12(4)(a)2g.2g. ‘Consumed.’ Property is “consumed” in farming when it is used 100% in farming. Items consumed in farming include repair tools used to repair farm machinery or farm equipment, insect control strips, computers used indirectly but solely in the business of farming, test kits to test milk for contaminants, and lubricants used in farm tractors and machines.

Tax 11.12(4)(a)3.3. ‘Accessories, attachments, and parts.’ Included within the exemption are accessories, attachments, and parts for tractors and machines used exclusively and directly, or which are consumed or lose their identities in the business of farming. “Accessories” and “attachments” include devices designed to be mounted on a machine, such as a slow moving vehicle sign attached to a tractor or pipes attached to an irrigation pump, or devices to be pushed or pulled by a machine such as a farm wagon or a plow. A machine “part” means a durable unit of definite, fixed dimensions and includes tractor tires, oil filters, and fuel pumps. Canvas covers and paint for exempt machines are exempt. “Parts” does not include fluids such as antifreeze, hydraulic fluids, or diesel fuel anti-gel additives. These are “other tangible personal property” rather than “parts.”

Tax 11.12(4)(a)4.b.b. “Machines which qualify for exemption” include, if not realty improvements, all-terrain vehicles or trucks not licensed for highway use, balers, chain saws for orchard or logging use but not for use in cutting firewood for personal use or for use in pulpwood or sawmill operations, choppers, corn pickers, crop conditioners, crop thinners, cultivators, discs, drags, end loaders, electric clippers and hoof trimmers, electric dehorners, electric fence chargers not fencing or insulators, electric foggers, fork lifts, harrows, harvesting combines, hay wagons, manure spreaders, mowers, planters, plows, powered posthole diggers, pumps and associated piping for irrigation, rock pickers, rotary hoes, space heaters not for residential use, sprayers, stalk shredders, and windrowers.

Tax 11.12(4)(a)4.c.c. “Machines which do not qualify for exemption” include tangible personal property and items and property under s. 77.52 (1) (b) and (c), Stats., that are attached to, fastened to, connected to or built into real property or that become an addition to, component of or capital improvement of real property. Also, tangible personal property, and items and property under s. 77.52 (1) (b) and (c), Stats., used or consumed in the erection of buildings or in the alteration, repair or improvement of real property, regardless of any contribution that the personal property, or item or property under s. 77.52 (1) (b) or (c), Stats., makes to the production process in that building or real property and regardless of the extent to which that personal property, or item or property under s. 77.52 (1) (b) or (c), Stats., functions as a machine does not qualify for exemption. However, there is an exception for those items specifically mentioned in subd. 4. d.

Tax 11.12(4)(a)4.d.d. The following items retain their character as tangible personal property and qualify for exemption, regardless of the extent to which they are fastened to, connected to or built into real property: auxiliary power generators, bale loaders, barn cleaners and elevators, conveyors, feed elevators and augers, grain dryers and grinders, irrigation implements, milk coolers, milking machines, including piping, pipeline washers and compressors, top and bottom silo unloaders, and powered feeders, excluding platforms and troughs constructed from ordinary building materials.

Tax 11.12(4)(a)5.a.a. “Building” means any structure that is intended to be a permanent accession to real property; that is designed or used for sheltering people, animals, or plants, for storing property, or for working, office, parking, sales, or display space, regardless of any contribution that the structure makes to the production process in it; that in physical appearance is annexed to the real property; that is covered by a roof or encloses space; that is not readily moved or disassembled; and that is commonly known to be a building because of its appearance and because of the materials of which it is constructed.

Tax 11.12(4)(a)5.b.b. Certain machines in addition to those in subd. 4. qualify for the exemption if purchased by farmers directly from retailers, even though after the sale they are affixed to realty by the farmer, or someone hired by the farmer. Machines included are automated livestock feeder bunks, but not ordinary building materials; automatic stock waterers powered by electricity or water pressure and built into a permanent plumbing system; automatic water softeners, such as for milkhouses; barn fans and blowers and other ventilating units; unit heaters and other heating units; water heaters serving production areas; and water pumps serving production areas.

Tax 11.12(4)(a)6.6. ‘Motor vehicles and their accessories, attachments, and parts.’ Specifically excluded from the exemption are “motor vehicles for highway use,” which includes motor trucks, automobiles, station wagons, buses and motorcycles. The exclusion from the exemption also applies to accessories, attachments, and parts for motor vehicles for highway use. “For highway use” means registered or required to be registered for that use. Charges for labor for the repair of vehicles registered for highway use, such as nurse tanks and trailers, are taxable. Sales of parts for vehicles registered for highway use which are used exclusively and directly in farming or are consumed in farming, such as nurse tanks and trailers, are taxable.

Tax 11.12(4)(a)8.8. ‘Sales and use tax.’ A person who buys without tax by claiming the farming exemption owes the sales tax at the time the person uses the property or item purchased in a taxable manner or for a taxable purpose. Property, items, or goods purchased without tax by claiming they will be used exclusively and directly in the business of farming, become subject to the tax when use of the property, items, or goods for nonexempt purposes exceeds 5% of total use. Property, items, or goods purchased without tax by claiming they will be consumed or lose their identity in the business of farming, become subject to the tax when the property, items, or goods are used for a purpose other than for an exempt use in the business of farming.

Tax 11.12(4)(b)(b) Section 77.54 (3m), Stats., exempts: “The sales price from the sale of and the storage, use or other consumption of the following items if they are used exclusively by the purchaser or user in the business of farming; including dairy farming, agriculture, horticulture, floriculture, silviculture, beekeeping, and custom farming services: