Cheap soil tests make way for million-dollar write-offs as farmers rush to claim a controversial tax break.
A new tax strategy is making waves through the farming community. In the last three years, Section 180 has transformed from a little-used benefit buried in the tax code to a major tax shelter for farmers. Across the country, farmers are getting shockingly high deductions worth hundreds of thousands of dollars with the help of a relatively low-cost soil test. And they’re urging their neighbors to do the same.
“Some of these analyses are showing deductions worth as much as half the total property value,” said Kristine Tidgren, director of the Center for Agriculture Law at Iowa State University, who is regularly contacted by CPAs considering the strategy. She’s seen deduction estimates as high as $12 million.
Since it was voted into law 65 years ago, Section 180 — which gives farmers a one-time deduction for their above-average soil fertility — has been largely overlooked because the IRS never published any guidance on how to use it. With no formal process or clear use case, CPAs avoided the risk of audit. But in recent years, sentiment has changed.
An increasing number of farmers have jumped on board — often with the help of new companies that specialize in Section 180. These companies claim to have cracked the code: an audit-proof calculation of your soil’s fertility. And after multiple years with no IRS intervention, even more conservative CPAs are coming around to the idea. But there are still industry leaders who are wary. They warn that these massive deductions — worth as much as half the total value of the land — could very well be outside what the IRS intended, potentially causing problems with audits and future land sales.
According to the IRS, land and its naturally occurring nutrients are not a depreciable asset, with emphasis on “naturally occurring.” The Section 180 deduction, however, offers a caveat for nutrients beyond natural levels. Also known as residual soil fertility, any above-average nutrient levels in the soil — created through fertilizer application or a property’s unique features — increase the value of the land.
Section 180 treats this above-average soil fertility much like other high-value elements that come with the land. The value of those nutrients can be deducted — much like the value of fences, irrigation equipment, and structures that come with a property.
“Some of these analyses are showing deductions worth as much as half the total property value.”
Distilling “above average fertility” into hard numbers — especially with no legal precedent from the IRS — has always been the problem. Other than a technical advice memo issued in 1991, there have been no court cases, statutes, or laws to go on, Tidgren said. But a handful of third-party companies have arisen, claiming to fill in that gap.
“You’ve heard of forensic accounting. We call this forensic agronomy,” said Zack Porter, co-owner of Boa Safra Ag, one of the largest companies running soil analyses for Section 180. So far, Boa Safra has done more than 5,000 analyses for customers across all 50 states. For $40 per acre, they send a team to take soil samples in a 10-acre grid across the property at two different depth levels.
Based on measurements of eight macro- and micronutrients, they get a snapshot of the soil’s nutrient density. Then they subtract the naturally occurring nutrients for the area and any fertilizer the farmer has added. If the land has been farmed since purchase, they replenish nutrient losses from grazing or crops. By accounting for all those deposits and withdrawals, Boa Safra says they can reliably find a property’s residual nutrients at the time of purchase.
Using a proprietary calculation and the regional price of the nutrients in the year the land was purchased, that residual fertility is then assigned a dollar value. For Boa Safra, the national average is a $1700-per-acre deduction, according to a company spokesperson.
The soil science it takes to get these measurements isn’t new, according to agronomist Neal Kinsey, who runs his own soil fertility consultancy. Though it is faster and more accessible than ever before. The real driver for the uptick in Section 180 deductions, he believes, is rising fertilizer and land costs.
The less certain, but potentially bigger risk: No one is sure that this approach is totally in line with the IRS’s intentions.
Farmland hit a record price per acre in 2025, and fertilizer costs have been on the rise for years. Prices steadily rose over 2025, thanks to trade policy between the U.S. and China, and are already 10 to 20% higher in 2026 than they were a year ago, according to Texas A&M Extension. Eight of the major fertilizers have already risen in price since January.
Because of the increasing costs, “more recently purchased lands will tend to have a higher deduction,” Porter said.
“Jay,” a Western Kentucky farmer and landlord who asked not to use his real name for fear of an audit, purchased both of his properties less than six years ago, in 2020 and 2025. In 2024, he started hearing about Section 180 deductions from his row-cropping neighbors. Several deducted more than $1200 per acre in 2025. So, when Jay got a flyer for Boa Safra in the mail last fall, he went for it. He agreed to the $40-per-acre sampling fee, and the company sent out a team to sample both farms. In late December, his results were in — a projected $1300-an-acre deduction.
Because Jay’s land was purchased recently, the soil analysis was fairly straightforward. But Boa Safra advertises its services for any purchases made in the last 20 years, leveraging three additional tax codes and three filing methods. Porter said the soil analysis for these properties is slightly more involved, but the same $40-per-acre price point applies. These more complicated clients make up 60% of their customer base.
But these approaches are certainly not without risk, Tidgren warned.
First, taking the fertility deduction decreases how much a farmer has invested in the land. That makes the deduction a bad move for anyone looking to sell their land in the near future because it will significantly increase taxable profit. The less certain, but potentially bigger risk: No one is sure that this approach is totally in line with the IRS’s intentions, Tidgren said.
“I think [nutrient deductions] will continue to get more frequent and, perhaps, the deductions will become more aggressive.”
While she has no problem with farmers getting meaningful deductions, the ag tax law expert is wary that these deductions reaching hundreds of thousands and even millions of dollars are pushing a limit. The one decades-old piece of tax law that experts have to go on focuses on using Section 180 to deduct fertilizer costs applied by the previous owner — fertilizer in the ground but not yet used. “There is not much risk for that approach,” she said.
But the companies offering Section 180 analyses aren’t looking at past fertilizer applied; they’re tallying a deduction based on a calculation of soil nutrients. “At what point are the [soil] nutrients just your land?” Tidgren asked. These massive nutrient deductions appear to be separating nutrients from the land, making a second valuable entity where there was only one, she said.
At the very least, there’s no precedent for this nutrient-calculating strategy, nothing in the tax code to confirm it’s an option, Tidgren said. Several companies report that their approach stands up to audit. Boa Saafra, for instance, reports eight known audits on deductions ranging from $200,000 to $2 million, and all were issued no change rulings — a 100% success rate. But because those audits aren’t public, it’s not a reliable fail-safe, Tidgren said.
Many farmers and tax professionals have shared Tidgren’s apprehension. But after several years with no crackdown from the IRS — or any mention of Section 180 at all — more farmers and CPAs are switching sides, looking to get in on the deduction while they can. Until and unless there’s a clear “No” from the IRS, “I think [nutrient deductions] will continue to get more frequent and, perhaps, the deductions will become more aggressive,” Tidgren said.
