Just like assets, your liabilities in FarmRaise Tracks should be categorized by how long you’ll take to repay them. This ensures your balance sheet reflects the true health of your farm or ranch—and it's especially important when you’re preparing for a lender meeting, applying for USDA programs, or calculating your debt-to-asset ratio.
Liabilities are your debts or financial obligations, and they’re divided into three types based on how long they’ll take to pay off: current, intermediate, and long-term.
Current Liabilities (Due in One Year or Less)
Current liabilities are debts that you expect to pay off within the next year. These typically come from everyday operating costs or short-term credit sources.
Examples of current liabilities:
Accounts payable (bills for inputs, feed, supplies, etc.)
Credit card balances used for farm expenses
Unpaid wages or payroll taxes
Current portion of longer-term debt (i.e. the part of a mortgage or equipment loan due this year)
Tracking current liabilities in FarmRaise Tracks helps you plan for upcoming bills and make sure you have enough current assets to cover them.
Intermediate Liabilities (Due in 1–10 Years)
Intermediate liabilities are loans or debts that are repaid over a period of 1 to 10 years. These typically fund purchases that support your operation over the medium term, such as equipment or livestock.
Examples of intermediate liabilities:
Equipment loans (e.g., tractor or hay baler financing)
Vehicle loans (for trucks, trailers, ATVs)
Breeding stock loans
Lines of credit (if structured with repayment over several years)
It’s important to match your liabilities with the life of the asset they financed. If you bought a planter with a five-year loan, that’s an intermediate liability tied to an intermediate asset.
Long-Term Liabilities (Due in More Than 10 Years)
Long-term liabilities are large debts that you’ll pay off over a decade or longer. These often relate to permanent infrastructure and land purchases.
Examples of long-term liabilities:
Mortgages on farmland or buildings
Irrigation system financing (e.g., for large pivots or tile systems)
Long-term real estate loans
Beginning farmers may have long-term liabilities like mortgages even if they don’t yet own many long-term assets. That’s okay—what matters is tracking the loan terms and making sure you're building equity.
Why Categorizing Liabilities Matters in Tracks
Breaking out your liabilities in FarmRaise Tracks helps you:
Understand your financial obligations at a glance
Prepare accurate, lender-ready balance sheets
Compare liabilities to your assets and equity
Monitor how much short-term vs. long-term debt you carry
Plan repayment schedules and stay on top of interest costs
Quick Reference Table
Liability Category | Timeframe | Common Examples |
Current | ≤ 1 year | Credit cards, accounts payable, payroll taxes |
Intermediate | 1–10 years | Equipment loans, vehicle loans, lines of credit |
Long-Term | 10+ years | Mortgages, land loans, irrigation infrastructure |
If you’re not sure where a loan or debt belongs, look at the loan term or when it’s due to be paid off. Need help? Just reach out to the FarmRaise support team—we’re happy to walk you through it.