Farm Industry Trends
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Cancelled Health Insurance Policies
Amid a wave of controversy over health insurance policies that have been cancelled this year, the Department of Health and Human Services announced Thursday, December 19 that those with cancelled policies will not need to pay the individual mandate penalty in 2014. Those who have received notices in recent months will receive a hardship exemption […]
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Tax Filing Begins January 31, 2014
The IRS announced in Notice 2013-100 that the official start of the filing season for 2013 tax returns will begin on January 31. This is one day later than for 2012 tax returns. The 2012 tax season filing delay was due to the many changes brought about by the tax law signed into law on […]
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Is it Time for an IC-DISC
Many farmers or groups of farmers are starting to earn a greater percentage of their income from sale of products directly for exports. If this applies to your farm operation and the amount of foreign exports is greater than $1 million, then you should consider forming an interest charge – domestic international sales corporation (IC-DISC). This […]
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What Crop Insurance Level Should I Get for 2014?
Crop insurance is a risk management tool for farmers. Over the last couple of years it has, in many cases, paid off in substantial claims based primarily on the high spring or fall price. The University of Illinois just released a projection of the crop insurance premiums for productive soil in that state. Although large claims […]
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How $12,000 Becomes $6,000 or less
As corn prices continue to range near multi-year lows and the expectations for increases in interest rates start to perk up (taper anyone), the value of farmland may start to reverse their strong decade or longer advance. For example, assume we have a farmland owner in Northern Iowa who has 190+ bushel acre corn ground. Last year, his […]
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IRS Almosts Eliminates the 1/2 cent
The IRS just announced the standard mileage rates for 2014. They are as follows: Business Mileage – 56 cents per mile Charity Mileage – 14 cents per mile Medical Mileage – 23.5 cents per mile The nice thing is that they finally eliminated the 1/2 per mile for business miles, but did retain it for […]
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2014 Cash Rents Equals Negative Returns For Farmers
In a post from the University of Illinois today, they essentially said that based on current crop prices, farmers who are cash renting ground in Illinois will either make about $10 per acre or in the case of Southern Illinois farmers lose about $30 per acre. These numbers are for the averages. In areas where high […]
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The Rich Are Different – They Have to Pay More
The Tax Court released a very interesting and to some degree an entertaining case on Tuesday. Michael D. Brown was considered a super life insurance agent to the Forbes 400. He normally would not handle any life insurance policies with a face value less than $10 million and in many cases, he was the agent […]
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Losses Can Offset Investment Income
Another nice feature of the final net investment tax regulations released last week is that certain losses are now allowed to offset other net investment income. In the original proposed regulations, you could not have a loss (such as the sale of stock) reduce your other net investment income. Once you reached zero, you were […]
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Bonus Payments Are Ordinary Income – Not Capital Gains
The Tax Court issued the Dudek case today concerning whether upfront bonus payments received from an agreement to allow an oil and gas company to lease property is considered ordinary income or capital gains. In the case, Mr. Dudek, a CPA (why are some CPAs more likely to go to tax court when they know […]