Farm Taxes

  • When is a Deposit Income?

    I will be at the annual American Institute of Certified Public Accountants Ag Convention in Denver today till Friday.  I hope to come away some ideas for our farmers. We had a reader ask the following question: “Can you hold checks that have been sent to us for grain sold in 2010 until 2011?” The […]

    More

  • How to Allocate Land Purchase?

    We received the following questing regarding our post on the allocation of land purchase to vineyard AVA: “Paul, You cover depreciating improvements on land. I am buying 150 acres in north-central Iowa that is bare ground. It has two county main tile lines running through it, has a blacktop road on one side and a […]

    More

  • Creative Taxpayer Gets Denied

    Many farmers forget to properly allocated their purchase price when purchasing land.  For tax purposes, you can not deduct land, however, you can depreciate any improvements made to the land.  For example, assume a farmer buyer a quarter section for $1 million dollars.  On that quarter section, there is a well, roads, fences, buried main […]

    More

  • Cost Basis Now Reported on Form 1099-B

    Back in 2008 a new law was passed requiring banks and brokerage companies to report the cost basis of stocks, bonds, etc. sold during the year.  This reporting is to start for purchases after December 31, 2010. The IRS has now released regulations that this cost basis information will be reported on form 1099-B which […]

    More

  • Watch Your State Disconnect on Tax Depreciation

    As we have previously noted in a couple of posts, the Section 179 deduction has been substantially increased for this year and next year to $500,000 and the 50% bonus depreciation has been re-enacted for 2010.  However, most if not almost all states do not follow this rule.  I know that Oregon does not follow the federal […]

    More

  • The Use of Dyed Diesel Leads to $9,000 IRS Penalty

    In my home state of Washington, we now have a case of the IRS fining a farmer $9,000 for using dyed off-road diesel in his bale wagon to transport the hay from his field to his haystack.  During this transport, the farmer was briefly on a public road and an IRS agent staked him out […]

    More

  • Consider Taking Your Dividends Now

    Many farmers created corporations several years ago that have always been taxed as a regular C corporation or may have switched to an S corporation after several years of profitable operations.  These corporations may have several hundred thousand dollars of retained earnings that under current law if they were distributed to the owners would be […]

    More

  • Get Ready for Billions of 1099’s

    One of the little items that was included in the Health Act passed earlier this year was the provision that mandates the filing of form 1099 for a lot more items than is done now. Under current law, a farmer is normally required to issue a form 1099 for payment of: Services or rents paid […]

    More

  • The 3.8% Sales Tax on Home Sales (Hoax)

    I have received multiple e-mails in the last month or so about the Obama 3.8% sales tax on the sale of your home starting in 2013.  There is no federal sales tax on any home sale in today’s tax law. However, there is a provision in the Health Care Act passed earlier in the year […]

    More

  • IRS Issues 5th Update of Extreme Drought Areas for Extended Livestock Replacment Period

    The IRS has released the fifth annual list (published each September) of counties or parishes in which exceptional, extreme, or severe drought has been reported during the preceding 12 months.  This list can be used instead of the U.S. Drought Monitor maps to determine whether an extended replacement period applies for livestock sold because of […]

    More

Subscribe to Our Email List

* indicates required