Short answer: Whether net wrap is sales-tax exempt depends entirely on your state — and sometimes on how you use it. Farmers report it is taxed in Illinois, exempt in Iowa and Minnesota, conditional in Nebraska (exempt only if you bale your own acres and sell the bales), and inconsistent in South Dakota (taxed for your own baling, exempt for a custom operator). Don't assume "ag use = exempt." Check your own state's rule and keep your exemption certificate handy. This is a farmer-reported reality check, not tax advice — confirm with your state revenue department or accountant.
A round-baler told a familiar story on AgTalk: he went to prepay for net wrap at the dealer and got charged sales tax on it — on a product that sure feels like an ag-production input. The thread that followed is one of the clearest crowd-sourced maps of how wildly the rules vary by state. Here is what producers reported, and how to figure out your own situation.
"Im fairly new to round baling and was pre paying net wrap today at John deere and noticed that they charged sales tax. They told me that net wrap is not sales tax exempt in Illinois. Is this true? Seems like a fairly common 'ag production' product."
— mac4440, Central IL · AgTalk thread 1090294
Why farmers get surprised by this
Most states draw a line between farm machinery and equipment (often exempt) and expendable supplies (often taxed). Net wrap, twine, and oil tend to land on the taxed side of that line in some states, even though they are clearly used in production. The result is the kind of inconsistency that drives producers crazy:
"My understanding is that expendable products (oil, twine, netwrap, etc) are not tax exempt here in IL."
— Blusteryknollfarm, North Central Illinois · AgTalk thread 1090294
"Funny how oil filters are tax exempt, but oil isn't."
— mac4440, Central IL · AgTalk thread 1090294
State-by-state, as farmers reported it
Treat the table below as a starting point from producers in the thread — not as the final legal word. State rules change, and your specific use can flip the answer.
- Illinois — taxed. Multiple IL producers confirmed net wrap is charged sales tax as an expendable supply.
- Iowa — not taxed.
- Minnesota — not taxed (note: fencing supplies are taxed in MN, because fence is treated as a real-estate improvement).
- South Dakota — it depends who's baling. Reported as taxed if you bale your own, exempt for a custom operator.
- Nebraska — conditional. Exempt only if you bale your own acres and sell the bales; taxed if you feed the bales to your own animals or do custom baling.
Here are those reports in the producers' own words:
"No sales tax in netwrap in Iowa and Mn. SD is a bit goofy as if baling your own it's taxed but a custom guy doesn't have to pay sales tax on it."
— swmnhay, Reading MN · AgTalk thread 1090294
"Nebraska is exempt if you're baling your own acres and selling the bales. Not exempt if your feeding the bales to your own animals or custom baling."
— mkurkowski, Ogallala NE · AgTalk thread 1090294
And a reminder that the same state can produce different experiences depending on the seller and the paperwork:
"Hmm. I've never paid sales tax on net."
— Gearclash, Sioux County NWIA · AgTalk thread 1090294
The pattern that actually matters: how you USE the bales
Notice that the Nebraska and South Dakota answers don't hinge on the product — they hinge on what you do with the finished bale. The common logic across "conditional" states is roughly:
- Baling to sell the bales as a product → more likely exempt (it's an input to something you'll resell).
- Baling to feed your own livestock → more likely taxed (it's a consumed supply, not a resale input).
- Custom baling for hire → varies — sometimes the custom operator's purchase is exempt, sometimes not.
That distinction is why two neighbors in the same county can honestly report opposite experiences.
How to confirm your own situation
- Look up your state's ag-exemption rule by category. Search your state revenue department site for "agricultural exemption" plus "supplies" or "twine and net wrap." Many states publish a specific list.
- Have an exemption certificate on file with your dealer. Some of the "I never pay tax" experiences come down to the dealer having the right certificate on record.
- Match the certificate to your actual use. If your state ties the exemption to reselling bales, claiming it while feeding your own herd can be a problem in an audit.
- Ask your accountant once. A five-minute question settles it for every future purchase.
It changes more than you'd think
Even within a single state, the rule is a moving target. One Nebraska producer noted the exemption had gone away:
"Not tax exempt anymore in nebraska either."
— wire farms, Nebraska · AgTalk thread 1090294
That is exactly why the smart move is to verify the current rule for your state and use-case rather than relying on what was true a few years ago — or on what a neighbor across the state line pays.
One thing you CAN control: your per-roll cost
Sales tax is mostly out of your hands. The price you pay before tax is not. Buying at the right time of year and in the right quantity moves the needle far more than the tax line does. See when to buy net wrap for the seasonal pricing windows, the pallet bulk-buying guide for volume math, and how to find the cheapest net wrap without buying junk.
FAQ
Is net wrap tax exempt for farmers?
It depends on your state and how you use the bales. Farmers report it is taxed in Illinois, exempt in Iowa and Minnesota, and conditional in Nebraska and South Dakota. Always confirm with your state revenue department.
Why did my dealer charge sales tax on net wrap?
Many states classify net wrap as an "expendable supply" rather than exempt farm equipment, so it gets taxed. In some states the exemption also requires that you bale to sell rather than to feed your own animals.
How do I get the exemption if my state allows it?
File the correct agricultural exemption certificate with your dealer and make sure your actual use matches what the certificate covers. Check your state revenue department for the exact form.
Whatever your tax situation, XES net wrap keeps the pre-tax number low: factory-direct pricing on 48" to 67" widths, 680 lb tensile strength, and DLG-certified UV protection. See XES net wrap sizes & pricing →
Daisy is the growth marketer at XES Bale Nets. She reads farmer forum threads so you can find clear answers faster. Every quote in this post is verbatim with a source link — go read the originals. Nothing here is tax advice; confirm your situation with your state revenue department or accountant.
