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BOE-401-INST REV. 13 (4-13)

STATE OF CALIFORNIA

BOARD OF EQUALIZATION

Complete this line to claim a partial exemption for the sale, storage, use or other consumption of qualified farm equip

ment, machinery and their parts, as described below. It also applies to qualified lease payments for farm equipment and

machinery rentals payable on or after September 1, 2001.

Who can claim a partial exemption?

You can claim this partial exemption if you are a person engaged in an agricultural business described in Codes 0111

to 0291 of the Standard Industrial Classification (SIC) Manual or are a person that assists such classified person by per

forming an agricultural service described in Codes 0711 to 0783 of the SIC manual.

What type of equipment is eligible?

• “Implements of husbandry,” as defined in Revenue and Taxation Code section 411. Such property generally includes

any tool, machinery, equipment, appliance, device, or apparatus. The farm equipment, machinery, and parts must be

used primarily in producing and harvesting agricultural products. “Primarily” means 50 percent or more of the time.

• Property as defined in Chapter 1, Division 16 of the Vehicle Code used exclusively in agricultural operations. Such

property under certain conditions includes lift carriers, tip-bed type trailers, trailers/semi-trailers having no bed,

spray or fertilizer applicator rigs, nurse rigs or equipment auxiliaries, row dusters, trap wagons, fertilizer nurse tanks

or trailers, cotton trailers, truck tractors and truck tractor/semi-trailer combinations. Vehicles primarily designed for

the transportation of persons or property on a highway are generally not considered implements of husbandry and,

therefore, do not qualify for this partial exemption.

Line 3. Diesel Fuel Used in Farming and Food Processing

For additional information for this exemption refer to publication 66, Agricultural Industry and Regulation 1533.2, Diesel

Fuel Used In Farming Activities or Food Processing.

Complete this line to claim a partial tax exemption for the sale, storage, use, or other consumption of diesel fuel used in

farming or food processing activities.

The diesel fuel must be consumed during the activities of a farming business as set forth in Internal Revenue Code (IRC)

263A or food processing. A farming business is a business that grows crops, fruit- or nut-bearing trees, sod, or nursery

plants. Farming activities also include transporting these crops, fruit- or nut-bearing trees, sod, or nursery plants to the

marketplace.

Line 4. Timber Harvesting Equipment and Machinery

For additional information for this exemption refer to Regulation 1534, Timber Harvesting Equipment and Machinery.

Complete this line to claim a partial exemption of the sales and use tax for the sale, use, or other consumption of timber

harvesting equipment, machinery, and their parts. Such equipment and machinery must be designed for use 50 percent

or more of the time off-road in commercial timber harvesting and be used 50 percent or more of the time in timber har

vesting. A qualified person is a person who is engaged in commercial timber harvesting. Commercial timber harvesting

involves the cutting or removal, or both, of timber and other solid wood forest products from timberlands for commercial

purposes. The partial exemption also applies to a qualified person’s lease payments for qualified commercial timber har

vesting equipment and machinery rentals payable on or after September 1, 2001.

Timber is considered to be trees of any species, excluding nursery stock, harvested for forest products. Some examples

of these products include firewood, Christmas trees, biomass, poles, and pilings.

Typical off-road commercial harvesting equipment and machinery and their general use, that may be eligible for this par

tial exemption include:

• Tractors or rubber tired skidders—move the logs from the woods to the logging trucks

• Front end loaders—load logs onto trucks

• Feller-bunchers—cut very small trees

• Cable Yarders—harvest trees on very steep slopes by suspending the logs on a cable

• Chippers—chip small logs and brush into very small pieces

• Chainsaws—used to cut down trees

Line 5. Racehorse Breeding Stock

For additional information for this exemption refer to Regulation 1535, Racehorse Breeding Stock.

Complete this line to claim a partial exemption of the sales and use tax for the sale, storage, use, or other consumption

of “racehorse breeding stock.”

“Racehorse breeding stock” means racehorses capable of and purchased solely for the purpose of breeding.

Instructions For Form Boe-401-A - State, Local, And District Sales And Use Tax Return Page 6

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