Patronage Dividend Notices Can Be Sent by Email or Posted to a Website
The IRS recently issued a private letter ruling (PLR 201413002) allowing a cooperative to provide notice by email or a posting to their website instead of mailing all notices by regular mail. In order for Cooperatives to get a deduction for their patronage dividends, they must provide written notice by a certain date each year. With postage now running over 50 cents plus the time and effort in preparing the notice, etc. this cost can add up fairly quickly.
The private letter ruling now allows this Coop to do it electronically. Normally a private letter ruling applies only to that particular taxpayer, but it seems that all co-ops should be able to provide proper notice using these new methods. I know that I have seen several form 1099-INT this year for interest income under a dollar and in one case for two cents. Eliminating these extra costs would serve the IRS and taxpayers well.
Paul Neiffer, CPA
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a principal with CliftonLarsonAllen in Walla Walla, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. Paul and his wife purchase an 180 acre ranch in 2016 and enjoy keeping it full of animals.
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