If you own working farmland, 2026 may be the year your second income stream finally becomes legal without a lawyer on retainer. California now lets counties authorize overnight camping on farms with a fraction of the old red tape, and Oregon created a purpose-built permit for farm stores with agritourism baked in. Both laws share one goal: helping farmers diversify revenue while the land stays in production.
The money at stake is real. U.S. farms and ranches generated $1.26 billion from agritourism and recreational services in 2022, up 12.4 percent in real terms since 2017, and the average agritourism operation grossed about $44,000, according to USDA Census of Agriculture data. Campsites, farm stores, tours, and dinners are no longer side hustles — for many small farms, they are the margin between breaking even and going under.
But every new revenue line is also a new bookkeeping obligation. Here is what changed in each state and how to record the new income correctly from day one.
California AB 518: Overnight Camping on Working Lands
California's Assembly Bill 518, signed into law and effective January 1, 2026, creates a state framework that lets counties opt into a simplified program for low-impact camping on agricultural land. Instead of navigating the full campground-permitting process, participating landowners can host small-scale overnight stays under clear statewide guardrails.
What the law allows
- Up to nine temporary campsites per participating parcel, for tents, yurts, or RVs.
- Parcels of at least two acres qualify.
- Stay limits: campers may stay no more than 14 consecutive nights and no more than 28 nights total per year.
- Exemption from the Special Occupancy Parks Act, which means qualifying sites skip the formal campground permitting run through the California Department of Housing and Community Development.
What it means for your farm
The key word is counties: AB 518 is an opt-in framework, so the program only exists where your county adopts it. Before you list a single campsite, confirm your county has joined and learn its local siting, sanitation, and fire-safety conditions. Counties can add reasonable local standards on top of the state baseline.
Think of the revenue model in advance. Nine sites at, say, $60 a night across a six-month season can gross well into five figures — but only if you treat it as a business from the start: a booking system that timestamps every stay, a nightly log that proves you stayed within the 14-night and 28-night caps, and receipts that separate the site fee from anything else you sell the camper (firewood, farm boxes, breakfast). Those caps are the legal boundary of the exemption, so your records are your compliance evidence.
Do not forget transient occupancy tax
California campsite fees can trigger transient occupancy tax (TOT), the hotel-style tax most counties levy on short stays. TOT rules are county-level, and whether farm campsites are covered — and at what rate — varies widely. Call your county tax collector before your first booking, find out whether you must register as an operator, collect the tax at checkout, and remit it quarterly. Nothing sours a promising new revenue line like a back-tax bill with penalties in year two.
Oregon HB 4153: The Farm Store Permit
Oregon's House Bill 4153, signed by the governor in 2026, modernizes what farms on exclusive farm use (EFU) land can do commercially. Its centerpiece is an optional Farm Store permit — a defined path for farms whose roadside stand has outgrown the old legal limits.
What the law allows
- Farm stores up to 10,000 square feet as a permitted use on EFU land, selling products grown on-site plus goods from a defined local agricultural area.
- Agritourism as a permitted use of farm store structures: farm tours, educational exhibits and classes, hayrides, and seasonal events — framed explicitly as a supplement to farming, not a replacement for it.
- Onsite kitchen facilities licensed by the Oregon Health Authority for farm-to-table meal operations, with limits so the kitchen cannot morph into a standalone café or drive-through.
- No lodging or dwelling use inside the farm store itself — the building is for retail, food, and events, not overnight guests.
What it means for your farm
If you already run a farm stand that keeps bumping against size or use restrictions, the Farm Store permit is designed for exactly your situation: it trades legal gray area for a defined envelope. But "optional permit" still means a permit — budget for the application, the OHA kitchen licensing if you serve prepared food, and any siting standards your local government adopts.
From a revenue perspective, the law effectively blesses three distinct income streams under one roof: retail sales, prepared food, and ticketed agritourism events. Track them separately. A farm-to-table dinner, a hayride ticket, and a flat of berries have different cost structures, different margins, and potentially different tax treatments. Lumping them into one "farm store" line hides which enterprise is actually carrying the building.
The Bookkeeping Part Most New Agritourism Operators Get Wrong
Here is the single most important tax concept in this entire article: the IRS treats agritourism as a non-farm business activity, even though it happens on your farm.
Schedule F is for farming. Agritourism goes on Schedule C.
Income and expenses from growing crops, raising livestock, and preparing unprocessed products for market belong on Schedule F. Income and expenses from campsites, tours, classes, dinners, hayrides, corn mazes, and farm-stay lodging belong on Schedule C as ordinary business income. If your farm earns both kinds of revenue — and under these new laws, many more farms will — you file both schedules and keep the two enterprises' books separate.
This is not a cosmetic distinction. Farmers receive special tax treatments — including relaxed estimated-tax timing and deposit rules — that apply to farm income. Several USDA and Farm Service Agency programs also key off farm income specifically. Commingle your campsite or farm-store revenue into Schedule F and you risk misstating your farm income in both directions: claiming farm benefits on non-farm dollars, or muddying the farm numbers a lender or program office needs to see cleanly.
Run the agritourism arm like a customer of the farm
The cleanest structure, recommended by farm-tax educators, is to treat the agritourism enterprise as a separate business that transacts with the farm at arm's length:
- The agritourism arm "pays" rent to the farm for use of the land and buildings.
- It "buys" produce, flowers, firewood, and other farm products it resells or serves to visitors.
- The farm records those amounts as income on Schedule F; the agritourism arm records them as expenses on Schedule C.
- Every transaction gets a written record — an invoice, a transfer log, a consistent price list — even though both sides share an owner.
In practice, this means separate columns (or better, separate accounts) in your chart of accounts for each enterprise from the first dollar. Back-allocating a year's worth of mixed receipts at tax time is expensive, error-prone, and exactly what an examiner loves to second-guess.
Non-farm income does not get the farmer estimated-tax break
Farmers who earn at least two-thirds of gross income from farming can generally skip quarterly estimated payments and settle up once a year. Campsite fees and farm-store sales do not count as farm income for that test — and if the new enterprise grows large enough, it can tip your ratio below the threshold entirely. Once agritourism revenue starts flowing, revisit your estimated-tax plan mid-year rather than discovering a penalty the following April.
Four More Money Details to Get Right From Day One
1. Sales tax on retail and prepared food
Oregon has no statewide sales tax, which simplifies the farm-store side there — but California does, and prepared food, merchandise, and non-food retail each carry their own rules. In California, register with the California Department of Tax and Fee Administration if your farm-store sales are taxable, and configure your point-of-sale system to tax each product category correctly. A flat of strawberries and a branded sweatshirt are not the same transaction to a tax agency.
2. Liability insurance that actually covers visitors
A standard farm liability policy is written for production agriculture — not for dozens of campers with campfires or a sold-out farm dinner. Before opening, ask your agent in writing whether commercial recreation, lodging, and food service on the farm are covered, and at what limits. Many states also have agritourism liability statutes that limit your exposure if you post required warnings and follow safety practices — but those protections only help if you actually comply with their conditions. An uncovered injury claim can erase years of agritourism profit in a single settlement.
3. Permits and licenses as a cost of goods sold
County camping-program fees, the Oregon Farm Store permit, OHA kitchen licensing, food-handler certifications, fire inspections — these are real startup costs of the agritourism enterprise. Record them on the Schedule C side, not buried in farm overhead. When you later evaluate whether the farm store earned its keep, you want its full cost picture in one place.
4. Labor classification for seasonal help
Campsite hosts, tour guides, kitchen staff, and event crews are often seasonal and part-time — the exact profile where worker-classification mistakes happen. Crew members on a set schedule, in your uniforms, using your equipment, are employees, not contractors, whatever the handshake deal says. Budget for payroll taxes, workers' compensation, and California's $16.90 minimum wage (now in effect) or Oregon's regional minimums before you price your tickets and site fees. Labor you forgot to cost is margin you never had.
Common Mistakes New Agritourism Operators Make
- Running everything through the farm account. One checking account for crops, campsites, and dinners makes Schedule F/Schedule C separation a forensic exercise. Open a second account for the agritourism enterprise.
- Pricing from vibes instead of costs. A $60 campsite that required a $9,000 restroom, a $2,400 insurance rider, and ten hours a week of hosting labor is not a $60 margin. Build a per-unit cost sheet before you set prices.
- Skipping the county step. Both new laws route through local government — AB 518 needs county adoption, and Oregon's permit invites local siting standards. State permission is not the same as local permission.
- Treating the first year as "too small to track." The habits you build at nine campsites or one farm-to-table dinner a month are the system you will rely on when it scales. Small and sloppy becomes big and expensive.
Keep Your Farm and Your New Enterprise Organized From Day One
Adding campsites or a farm store means running two businesses on one piece of land — each with its own revenue, costs, tax schedule, and compliance calendar. The farms that thrive at agritourism are the ones that separate the enterprises on paper as carefully as they separate them in the field. Beancount.io provides plain-text accounting that gives you complete transparency and control over your financial data, with version history that shows exactly how every number was built — no black boxes, no vendor lock-in. Get started for free and keep both sides of the farm honest from the first booking.
