September, 2012
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Crop Revenue Would Need To Drop 21.4% to Equal 1980 Income Shock
The Kansas City Federal Reserve just issued a paper on the Nebraska economy and I found a couple of the pages in the paper interesting. First, to equal a 1980s income shock, current farm revenue would need to drop by 21.4% and the value of total farm production would need to decrease by 15.7%. Now 21.7% […]
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IRS Extends Drought Replacement Period for Ranchers
The IRS announced today in Release 2012-72 that they have extended the period for replacing livestock sold due to drought for another year. Normally, if a rancher is forced to sell their breeding, draft or dairy livestock due to drought, any extra sales caused by drought is allowed to be deferred for up to four years. This […]
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2012 Interest Rates for Special Use Valuation
The IRS today posted Revenue Ruling 2012-26 which lists the applicable interest rates (go to page 3 of release for the actual ruling) available if an estate elects Special Use Valuation in valuing farmland. Special Use Valuation allows an estate comprised primarily of farmland (or other qualified business property) to elect to value the farmland […]
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Columbia Basin Region Second to California in Diversified Crop Production
One of our local newspapers – The Tri-Cities Herald – is running a 29 part series on the various types of crops that are grown in the Columbia Basin region of Washington and Oregon. So far, they have run about 10 parts, but it is an excellent review of the various crops grown in the part […]
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Involve Your Kids With Year-End Tax Planning
Many multi-generation farms have the parents totally immersed in the finances of the operation while the children may be more focused on the actual farm production activities. Since this is a time of year (right after harvest) to do your year-end tax planning, try to get the kids more involved this year in the actual […]
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When a Penny Matters?
I was reading an article in Accounting Today (yes, there are magazines about the accounting profession) about how publicly traded companies are rounding up their earnings more than normally expected. For example, the authors reviewed the earnings announcements for over 330,000 positive earnings announcements from 1995-2009. With that big of a sample size, you would […]
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Mistakes to Avoid in Lifetime Giving – Final
This post has our final mistakes to avoid in doing lifetime giving: If you are doing Medicaid planned gifts, remember that all transfers for less than FMV are subject to a lookback period of 60 months. Avoid gifts of installment contracts to anyone other than a spouse. A disposition, which a gift is, will result […]
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Mistakes to Avoid in Lifetime Giving – Part 2
We continue our series on mistakes to avoid in lifetime giving: Be aware of the Generation-skipping Transfer tax on any gifts that may involve your grandchildren. These gifts can subject you to additional gift taxes that you may not realize apply when you make the gift. Any gifts in excess of $13,000 to these beneficiaries […]
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Mistakes to Avoid In Lifetime Giving – Part 1
Lifetime giving of appreciating assets is one great tool to use to prevent unnecessary estate taxes. However, if done incorrectly, these gifts can prove costly. I will do a multi-series post on some of the mistakes to watch out for in the next few days: If you will pay for someone’s education or medical costs, […]
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Express Saver Costs a Taxpayer Thousands
A recent US Tax Court case summarizes how a taxpayer who tried to save a few dollars on Federal Express shipping services most likely cost them thousand of dollars. In the court case, the taxpayer had received a deficiency notice from the IRS on April 8, 2011. The taxpayer had until July 7, 2011 to […]