Understanding IRS Code Section 180

Guest Post By: Karly Pavlinac

Agriculture land buyers compete on many fronts. Location, timing, financing, and yield. But there’s a little-known factor that quietly separates top performers from the rest: whether they leverage IRS Section 180 (IRS Code Reference).

The Hidden Competitive Edge

Section 180 allows farmland buyers to deduct the value of excess soil nutrients on new agriculture land purchases (crop, cattle, livestock). Phosphorus, potassium, calcium, magnesium, and more at the time of purchase. On average, the deduction comes in at $500+ per acre, with real cases climbing into the millions.

But what makes this powerful isn’t just the one-time tax benefit. It’s the capital efficiency it creates.

Ask yourself: What would you do if you had six figures of freed-up cash the year you bought farmland?

●      Pay down debt faster?

●      Fund operational improvements?

●      Move on the next acquisition before competitors?

That early advantage compounds. Investors who capture it accelerate their growth. Those who don’t, fall behind.

Why Most Investors Miss It

If it’s such a clear edge, why don’t more buyers use it?

Because it lives in a blind spot. It’s rooted in soil science, not spreadsheets, and it rarely appears in tax software or continuing education. CPAs, even the best ones, focus on compliance across broad strategies. Agronomy-specific deductions almost never cross their desk.

By the time a CPA reviews the file at tax season, fertilizer is often already applied and the deduction window has closed.

Which raises a question: What’s the cost of waiting until tax season to find out your peers already secured six-figure savings you can’t recover?

Outperforming Through Knowledge

Consider the difference:

●      An investor who buys 1,000 acres, applies fertilizer immediately, and never claims Section 180. Their capital is locked up, limiting flexibility.

●      Another investor, equally savvy on financing and operations, tests the soil first. Their Section 180 deduction creates six figures in tax savings they can deploy elsewhere.

On paper, the two deals look the same. In reality, one investor has created a permanent advantage over the other.

Top performers already know this which is why more agriculture land buyers are adding Section 180 into their acquisition strategy.

Why Sophisticated Investors Act Fast

Wealthy farmland buyers already know how critical speed is. They move quickly when:

●      The value is clear (six- and seven-figure deductions).

●      The compliance is airtight (CPA-ready, science backed reports).

●      The expertise is proven. Certified Crop Advisor affiliated with the American Society of Agronomy who specializes in Section 180 deductions.

Section 180 checks all three boxes but only for those who act before fertilizer is applied. Once it’s gone, it’s gone.

The Bottom Line

In a competitive farmland market, advantages compound. Investors who know and use IRS Section 180 build wealth faster, protect cash flow, and set themselves apart from peers who leave deductions buried.

So the question is simple: Will you use the advantage the IRS already wrote into the code or let your competitors move ahead without you?

Learn more about how Section 180 can give you the edge at Soil Tax Guys.