Senate Bill 641 (Section 143.121.3(10), RSMo) creates an income tax subtraction for payments received from a program that compensates agricultural producers who have suffered a loss due to a disaster or emergency.  The subtraction can be claimed on the Missouri Individual Income Tax Return (Form MO-1040), Missouri Fiduciary Income Tax Return (Form MO-1041), and the Missouri Corporation Income Tax Return (Form MO-1120) for tax years beginning on or after January 1, 2014.

You may qualify if you are an agricultural producer who received a payment from a program providing compensation due to a loss as a result of a disaster or emergency.  The agriculture payment must be included in your federal adjusted gross income or federal taxable income.

Taxpayers who qualify for the agriculture disaster relief subtraction for tax year 2014 or tax year 2015 should complete Form MO-AGDR. Section 1 of Form MO-AGDR should be completed by individuals, sole proprietors, and corporations. Section 2 of Form MO-AGDR should be completed by pass-through entities. Please refer to Form MO-AGDR for more instructions, including where to report the subtraction on your Missouri income tax return.

Taxpayers claiming the agriculture disaster subtraction for tax year 2016 should refer to the instructions for the type of return being filed.

The following documentation is required when claiming the agriculture disaster relief subtraction:

  • Form MO-AGDR (for tax year 2014 and tax year 2015 returns only)
  • Form(s) 1099 (that indicates your agriculture payment)
  • Federal Schedule F (if applicable)
  • Federal Schedule K-1 (if applicable)
  • Page 1 and 2 of your amended Missouri Partnership, S-Corporation or Fiduciary return (if applicable).

Note: Taxpayers claiming the subtraction based on payments from the programs listed below must also provide a signed statement indicating the payments were the result of a disaster or emergency. The statement should include the nature of the disaster or emergency and when it occurred.

  • Livestock Risk Protection Insurance Plan,
  • Livestock Gross Margin Insurance Plan,
  • Crop insurance,
  • Agriculture Risk Coverage (ARC),
  • Price Loss Coverage (PLC).

If the partnership, S corporation, trust, or estate previously filed their MO-1065, MO-1120S, or MO-1041, the entity must amend the applicable return to add the agriculture disaster payment as a subtraction modification. The amendment should result in a reduced net addition modification or an increased net subtraction modification when the agriculture disaster payment is added to any previous modifications. However, when the amount is entered on line 1 of Section 2 of the MO-AGDR, be sure to enter only the amount the entity received in agriculture disaster payments. Do not include any other sources included in the net addition or subtraction calculation on the MO-1065, MO-1120S, or MO-1041. Enter the ownership percentage determined from the amended MO-1065, MO-1120S, or MO-1041, on line 2 of Section 2 to determine the correct amount that can be deducted on the individual, or corporation income tax return. The MO-AGDR will provide line references for the applicable forms.

If the partnership, S corporation, trust, or estate had not previously filed their MO-1065, MO-1120S, or MO-1041, the entity will prepare the original return and include the agriculture disaster payments in the net addition or net subtraction. However, when the amount is entered on line 1 of Section 2 of the MO-AGDR, be sure to enter only the amount the entity received in agriculture disaster payments. Do not include any other sources included in the net addition or subtraction calculation on the MO-1065, MO-1120S, or MO-1041. Enter the ownership percentage determined from the MO-1065, MO-1120S, or MO-1041, on line 2 of Section 2 to determine the correct amount that can be deducted on the individual, or corporation income tax return. The MO-AGDR will provide line references for the applicable forms.

If the trust or estate previously filed their MO-1041, the entity must amend the MO-1041 to add the agriculture disaster payment as a subtraction modification. The amendment should result in a reduced net addition modification or an increased net subtraction modification when the agriculture disaster payment is added to any previous modifications. However, when the amount is entered on line 1 of Section 2 of the MO-AGDR, be sure to enter only the amount the entity received in agriculture disaster payments. Do not include any other sources included in the net addition or subtraction calculation on the MO-1041. Enter the ownership percentage determined from the MO-1041, on line 2 of Section 2 to determine the correct amount that can be deducted on the fiduciary income tax return. The MO-AGDR will provide line references for the applicable forms.

If the trust or estate had not previously filed their MO-1041, the entity will prepare the original return and include the agriculture disaster payments in the net addition or net subtraction. However, when the amount is entered on line 1 of Section 2 of the MO-AGDR, be sure to enter only the amount the entity received in agriculture disaster payments. Do not include any other sources included in the net addition or subtraction calculation on the MO-1041. Enter the ownership percentage determined from the MO-1041, on line 2 of Section 2 to determine the correct amount that can be deducted on the fiduciary income tax return. The MO-AGDR will provide line references for the applicable forms.

If you still have questions, please check out other Personal Tax FAQs.