Our Readers Catch Us!
In our post yesterday on the deferred payment contracts, we had indicated that there were six different combinations of income that could be reported using the three contracts shown. A couple of very observant readers had indicated we had missed one. The one missed was that all three contracts could be reported in 2013. Therefore, to recap the amounts that could be reported as follows:
- $50,000
- $60,000
- $70,000
- $110,000
- $120,000
- $130,000
- $180,000
These are the seven different amounts of income that could be reported. For example, if you wanted to increase your income by $150,000, you would have to decide between $130,000 and $180,000. You would not be able to pick exactly $150,000.
Many thanks to the observant readers out there for catching this.
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.
What about the 1099 that you would receive from the elevator that would show the income in the year the cash was received, not the year the crop was actually sold?