From Field to Funds: Using Invoicing to Track Custom Work, Hay Sales, and More

Running a farm or ranch isn’t just about working the land—it’s also about managing your money. If you’re selling hay, renting out farm machinery, or offering field service like spraying or landscaping, invoicing is one of the most important tools in your toolbox. It helps you track who owes you money, stay organized for your tax return, and make smart decisions for your small business.

Let’s dig into how creating invoices can help farmers like you improve cash flow, save time, and stay on top of your financial responsibilities.

Why Invoicing Matters for Farmers and Ranchers

Many farmers do custom work for neighbors or sell agricultural products like hay, firewood, or greenhouse plants. But if you aren’t keeping track of these jobs with invoices, you’re likely missing out on income or leaving yourself vulnerable during income tax season.

An invoice is a bill you give a customer after you do a job or deliver a product. It lists what was done, how much it cost, and how they can pay you. It’s also a record for your own bookkeeping.

By using invoicing features in tools like FarmRaise Tracks, you can track payments, add sales tax, and keep your inventory in order. These tools are more efficient than a paper invoice and much better for record-keeping.

Common Farm Jobs That Need Invoicing

If you're not sure whether you should be sending invoices, here are some examples of when invoicing helps:

• Custom Work: Spraying, planting, harvesting, or fertilizing for others
• Hay and Feed Sales: Selling square or round bales to other farmers or horse owners
• Landscaping and Home Services: Mowing, snow removal, or dirt work using your farm machinery
• Greenhouse and Garden Sales: Selling flowers or vegetables at markets or directly to customers
• Renting Out Equipment: Charging others for the use of your tractor, baler, or other tools

Any time money changes hands for products or services—not for personal use—you should create invoices.

Invoicing Tips for First-Time Users

If this is your first time invoicing, don’t worry. Today’s accounting software makes it easy. Here’s what to include in each custom invoice:

1. Your Farm Name and Contact Info
2. Customer Information
3. Invoice Date and Due Date
4. A Description of the Job or Product
5. Quantity and Price
6. Sales Tax if it applies (or note tax exemption if not)
7. Total Amount due
8. Payment Method accepted (cash, credit card, check, etc.)

Most softwares let you pick from templates, choose a drop-down list of services, and even add custom fields like location, crop type, or hours worked.

Keeping Up with Tax Responsibilities

Good invoicing isn't just about getting paid—it’s about reducing your tax headaches. Here’s how it helps:

• Income Tax: Invoices show exactly how much you earned, which helps when filing your tax return.
• Use Tax: If you buy building materials or motor vehicles for farm use and don’t pay sales tax upfront, invoices help document that for use tax reporting.
• Excise Tax: Selling diesel, tobacco, or similar goods? You may owe excise taxes—again, good records make a difference.
• Tax Exemption: If you're selling to another taxpayer who is also exempt, you’ll need additional information for your files.

Some states treat personal property differently from real estate when it comes to taxes, so itemizing your farm vs home work helps you avoid confusion later.

Managing Workflow and Accounts Payable

Invoicing also helps you understand your workflow—what you’ve completed and what’s still waiting to be done. When combined with accounts payable (what you owe others), you’ll see your full financial picture more clearly.

This is especially helpful during the calendar year when preparing for your annual tax return or applying for loans. Banks and advisors like to see clear, easy-to-read records.

Need to look back on a sale? Your invoice history helps you answer customer questions quickly and professionally.

Choosing the Right Software for Invoicing

If you want to get serious about record keeping, FarmRaise Tracks could be a great next step for you! Many small business owners—including farmers—use QuickBooks Online, but FarmRaise Tracks is made especially for farmers and ranchers.

• Sending invoices via email or mobile app
• Adding sales tax automatically
• Tracking payments and overdue bills
• Organizing by field service, product, or customer

The mobile app lets you send invoices on the go—right from the barn, truck, or greenhouse. You can snap photos, mark jobs complete, and keep moving.

Avoiding Common Invoicing Mistakes

To stay in good standing with the IRS and customers, avoid these invoicing mistakes:

• Forgetting the due date
• Leaving off the total amount
• Not separating personal use from business use
• Skipping the sales receipt for paid jobs
• Mixing real estate improvements with temporary home service work
• Not updating your templates or drop down options

Always double-check your invoices for accuracy, especially if you're selling to government programs or larger co-ops that need additional information to process payments.

Final Thoughts: From Field to Funds

Invoicing may sound time-consuming, but it’s one of the smartest ways to improve your farm’s financial health. It turns your hard work into real cash flow, helps you track liabilities, and makes tax time much smoother.

Whether you're new to invoicing or upgrading your system, starting now will save you trouble later. Take time to explore the invoicing tools in your accounting software, especially if you're using FarmRaise Tracks!

Remember, good invoices aren’t just paper trails—they’re a roadmap to your success as a business owner.

Need help creating your first invoice or setting up FarmRaise for your farm? Reach out to FarmRaise—our team is here to help you track every bale, bucket, and buck.

Ready to get started? Use code IT312B at checkout for 20% off or use this link to checkout now.