Farm Industry Trends
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CPR for Section 179
The University of Illinois publishes a daily blog called the FarmDocDaily. This posting deals with information related to their Illinois farmers and sometimes it covers tax subjects important to farmers. Today, they covered Section 179 and provided a very interesting table related to amount of Section 179 deduction as a % of total depreciation expense on annual […]
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New Water Rules Coming?
We now have a new Food Safety Modernization Act which was primarily a response to the multiple break-outs of E Coli food poisoning over the last few years. The FDA is proposing many new Regulations in response to the new Act. Part of these regulations pertain to water sources used by farmers to irrigate their crops. […]
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Crop Insurance Deferral Update
David Repp and I are in Mason City, Iowa today for our second presentation of the Day Two of the The ISU Center for Agricultural Law and Taxation Farm and Urban Tax School. Joe Kristan of the Roth CPA firm presented the first day yesterday. Unlike yesterday in Sheldon when it was 4%, this morning it had warmed […]
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Sale of CRP Land – Is it Subject to the 3.8% Tax?
We had a reader ask the following question: “Hey Paul, Is farmland with current CRP Income subject to the additional 3.8% NII tax if sold in 2013. Assuming all other income thresholds are met.” This is one of those questions with multiple answers depending on the facts and circumstances of the taxpayer. As previously discussed, […]
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Corn Harvest is Winding Down
On Saturday, I spent all day with my friends Ken and Mary McCauley and their son Brad in NE Kansas helping them finish up corn harvest. They were down to about three or four days to go. The crops got in late and it had been slow going since yields were good and the weather […]
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Trusts Get Hit with New 3.8% Tax too
We have had several posts on the new 3.8% net investment income tax applying to individuals with net investment income especially rents. We sometimes forget that this tax will apply to trusts and estates beginning in 2013 and the applicable level is much lower. All the way down to less than $12,000. This means if a […]
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Crop Insurance Deferral Options
It appears that at least $5 billion of crop insurance claims have been processed this year and with the approximate $1.20 drop in corn prices from the spring, it is likely that additional corn claims will be made. Unlike last year when almost all claims related to yield losses, this year, most of the claims […]
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Update on the Net Investment Income Post
In our previous post, we gave an example of a farmer selling farm land that was cash rented out and it being subject to the new net investment income tax. This was designed an illustration, but we have gotten feedback that in many cases this 3.8% tax may not apply to a farmer in this situation. […]
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Everything You Want to Know About Net Investment Income Tax (or Not)
Tony Nitti does a regular column on Forbes.com and he just released a very good recap of the 3.8% net investment income tax that was implemented by Obamacare, but was not applicable until 2013. Many farmers assume this tax will never apply to them since their adjusted gross income will never be in excess of $200/250,000 […]
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Highlighted Inflation Adjusted Amounts for Farmers
The IRS just released Revenue Procedure 2013-35 last week updating all of the income tax items that are affected by inflation. Each year right after September 30 the IRS will release these items updated to reflect the annual inflation rate for the year ended September 30. The government is on a fiscal year that ends […]