Farm Taxes
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You Can File Income Tax Returns Now (Maybe)
The IRS announced that they started accepting e-filed tax returns on Friday January 31. However, I have already found several returns that are being delayed due to the state E filing system not being ready. This may be due to our software, however, since many state income tax returns are predicated on starting with net […]
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FSA Does Not Understand Tax Return Income
We received some correspondence from a CPA whose is battling with the FSA on the definition of AGI for S corporations, LLCs, LLPs, LPs and other similar entities. The FSA manual on page 6-12 lists the line items from federal income tax returns for computing AGI for purposes of payment limitations. For corporations filing using Form 1120 […]
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Top Producer – Day 1
Yesterday I spent most of the day in Coldwater, Michigan and I can tell you that the first four letters of that name was very appropriate. It was about 15 degrees below zero when I got up and I think it peaked out at zero later in the day. The event I attended was the […]
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Not Too Late to Make Portability Election!
The IRS just released Revenue Procedure 2014-018 that now allows an executor of an estate to make a late portability election. Portability allows the unused estate exemption of the first spouse to pass away to be “ported” over to the surviving spouse. For example, if Farmer Bean passes away in 2013 with a total estate […]
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You Must Start IRAs Draws at Age 70 1/2!
We had a reader ask the following questions: “As I understand the requirement for the IRA withdrawal at age 701/2. If the person is still working at 70 1/2 then it is not necessary to draw from your IRA. Is this true? Another question can a farmer for 2013 expense the full cost of a […]
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Cash Does Not Equal Gain
We got the following question from a reader: “I bought 3 farms in recent years. Is there a way to sell one or part of one and pay the other 2 off without paying tax on that money?” I can give a general answer to this question, but without having the actual facts of each […]
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Average is Important for 2013 Tax Filing
We had a reader ask the following question: “I would like to here more about income averaging over years and when should someone think of it or not?” Farmers enjoy a unique method of computing their income tax liability versus other taxpayers. Due to the possible wild swings in farm income, the Tax Code allows farmers […]
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Section 179 Update (or Not)
We had a reader ask the following: “I haven’t been able to see if there is any development in increasing the limit for Sec 179 lately for 2014. I am holding out on any equipment purchases until I see an increase in the limit. I would appreciate it if you keep us informed on any […]
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It Maybe Too Good to be True
The Wall Street Journal ran an article on Saturday regarding the Larry E. Austin et al tax court case that was decided in December, 2013 (you will need a subscription to the online version to read the article). This tax court case involved two families who owned a very successful distressed debt investment company. In […]
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Grain Gifts – How Are They Taxed?
We had an advisor send us the following question today: “We have a farm client who is a cash basis tax payer. He is considering making a gift of grain to charity in 2014. In your opinion, would it be necessary for him to make that gift out of grain harvested in 2013 or could […]