Farm Leadership
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Be Careful if You Have a Foreign Account
Many farmers and business owners may have an investment in businesses located overseas. If this investment is in the form of mutual funds or other passive holdings, there is usually no extra reporting to the IRS or Department of Treasury. However, many of these same farmers own corporations with farm operations in perhaps Canada or […]
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Supreme Court Rules Capital Gains Tax Owed in Chapter 12
The Supreme Court just issued a ruling that any capital gains tax owed as a result of selling farmland in a Chapter 12 bankruptcy filing is not dischargeable in bankruptcy and will remain a debt of the farmer. Chapter 12 is a special type of bankruptcy for farmers. It allows them to reorganize their assets […]
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Make Sure You Get Written Confirmation of Donation!
The IRS and Congress has gotten much more aggressive in requiring proper documentation of a charitable donation in excess of $250. Without this documentation, the IRS has the right to completely deny the deduction even though the taxpayer has a cancelled check AND a letter from the charity. In order for the deduction to be allowed, the […]
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IRS Notices Will Now be in “English”
One of the most painful part of being a CPA was responding to IRS notices. Most of these notices were written in such a way that even a professional tax advisor had problems in determining exactly what the IRS wanted or needed to be done. The IRS has now announced that it is in the […]
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Make Sure the Trust Owns the Property
We received the following questions from a reader regarding using a charitable remainder trust: I am retiring from farming and I have equipment valued at 500,000 ,all of which is fully depreciated. I would like to give this equipment to a charitable trust to get 50,000 over the next 9 years (I think they keep […]
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What “Exhausted” Means for Social Security
We had a reader respond to our last post on the trustees report about Social Security. In that post, we mentioned that the trustees are projecting that the Social Security “pension” fund will be “exhausted” by 2033, three years ahead of previous projections. Social Security is form of a pension plan and it has three […]
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Social Security Wage Base Expected to be $113,700 in 2013
The Social Security Administration (SSA) has projected that the wage base for 2013 will increase to $113,700 ($110,100 in 2012) due to an increase in average wages. However, the projection may change slightly when the actual increase in announced in October. The projection is part of the annual report that the SSA’s trustees gives to Congress […]
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Maximize Your Current Land Revenue!
In a meeting with one of my clients in Northern Illinois yesterday, we discussed one of their options for increasing their current land holdings without adding more land. They are in an area where farmland is costing $12,000 or more and none is available. Additionally, land rents are approaching or exceeding $400 per acre. One […]
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What is the Right Equipment Size?
I was riding on the tractor on Wednesday with Chris Barron, my fellow columnist for Top Producer magazine, and we had a good discussion about how farming is different from other “manufacturing” operations when it comes to the right equipment size. In most manufacturing operations, the weather plays no role in the production process. The […]
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The Iowa Farmland Premium
On Tuesday, I had a quick meeting at our Des Moines office. After that, I met Moe Russell at the local Village Inn for a quick cup of coffee (or in my case, a Coke since my mother bred out of me the coffee gene). Moe and I caught up with business and then had […]