Farm Industry Trends

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    May 24th, 2016


    Obama Administration Expands Overtime Pay Eligibilty

    Many of you may have been following the new expanded overtime eligibility rules saga associated with the proposed Department of Labor regulations (DOL). We finally have some clarity and it appears the new overtime rules may extend to an estimated 4.2 million workers. The rule increases the salary threshold that salaried workers are entitled to […]

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    May 20th, 2016


    Farmland Values Continue to Drop

    The Chicago Federal Reserve just released their First Quarter 2016 Ag Letter showing that farmland values continue to trend lower.  The district covers most of the I states in the corn belt and show the following year-over-year changes in farmland values: Illinois – Minus 5% Indiana – Minus 2% Iowa – Minus 5% Michigan – […]

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    May 19th, 2016


    Make Sure to Lock In Low Rate Family Loans

    The IRS just released the minimum interest rates for June 2016 and they continue to be at record lows.  These tables represent the minimum interest rate that you need to charge on loans, etc.  If you elect to not charge any interest, the tax laws require you to “impute” interest based upon these minimum rates. […]

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    May 18th, 2016


    Crop Insurance Payouts Lower in 2015

    Gary Schnitkey of the University of Illinois just posted an article in FarmDoc Daily on an analysis of crop insurance damage payments in 2015.  In 2015, the entire loss ratio for the industry was only .65 (1 is breakeven).  This ratio is much lower than the .97 ratio from 2010 to 2015 and also much […]

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    May 13th, 2016


    When Should You Pay Your Spouse and Kids?

    My father was 47 when I was born (I am the oldest of three kids) and he elected to start receiving social security at age 62 (when I was 15).  When a person elects to take social security benefits before full retirement age, there is a limit on how much you can earn before you […]

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    May 12th, 2016


    What is Reasonable Compensation?

    In the H.W. Johnson, Inc. Tax Court case issued yesterday, the Court found that a bonus arrangement paying out close to 95% of the net income of the company to the two key shareholders was in fact, reasonable compensation.  They also found that a $500,000 payment to an affiliated company was allowed even though there […]

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    May 9th, 2016


    Does FSA Allow Section 179 for Corporations

    About two years ago we posted that FSA was not allowing Section 179 as a deduction for S corporations and LLC/LLP/LPs.  We communicated our concerns to FSA and to others in Congress, etc. and thought that the FSA would update their interpretation to reflect Section 179 as an expense in arriving at AGI for these […]

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    May 2nd, 2016


    New HSA limits for 2017

    A health savings account (HSA) allows taxpayers to set aside funds for health expenses.  A deduction for the amount contributed is allowed as a deduction up to the limit allowed by the Code.  This deduction is indexed to inflation and the IRS just announced the amounts allowed for 2017 as: Singles – $3,400 up from […]

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    April 27th, 2016


    Pooling is Back!

    Senator Backus a few years ago proposed replacing the current tax depreciation system with a pooling system.  Under that system, personal property purchases and sales would be “pooled” together and the net remaining number would be multiplied by a percentage for that year to arrive at your net depreciation deduction.  If the net number was […]

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    April 25th, 2016


    Options for Education

    Now that the 2015 tax season is finally done, we can now start focusing on getting our required education (for us CPAs) scheduled for this upcoming year.  CPAs are required to get at least 40 hours of education each year.  There is not a lot of education focused on farm taxation and succession planning, however, […]

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