Farm Leadership
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Section 179 and Bonus Depreciation Update
I seem to get more emails, phone calls and conversations regarding Section 179 and bonus depreciation compared to any other question. Both the Senate and House have either discussed or proposed several bills to extend bonus depreciation and Section 179 or make them permanent. In my opinion none of these bills will ultimately be passed […]
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Communicate, Communicate, Communicate!
I was in Omaha yesterday with Dick Wittman and a local attorney doing a seminar for the Legacy Project on succession planning. One member of the audience mentioned that he felt like we had poured 100,000 bushels of corn into a 20,000 bushel grain bin. I know we covered a lot of material, but the […]
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Help on Updating Your Payment Yield
Farmdoc Daily released information on Friday on updating your farm payment yields. These payment yields will be used in calculating any PLC payments and will not affect ARC calculations. However, if the option to update yields will result in higher yields, it will usually pay to update the yield since future farm bills may refer […]
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Watch Out for Spousal Inherited IRAs
Spouses who inherited IRAs have a couple of elections available to them that non-spouses do not have. However, care must be taken to make sure that the 10% early withdrawal penalty does not apply when distributions are finally taken. When a spouse passes away owning an IRA whose beneficiary is the surviving spouse, that spouse […]
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ARC-IC Allows for Maximizing Flexibility (Perhaps)
Under the new farm bill, Agricultural Risk Coverage (ARC) has two elective components. You can either elect county coverage on a covered crop by crop basis (ARC-CO) or elect to have ARC apply to all crops grown on your farm (ARC-IC). If you elect county coverage, you will be paid on each covered crop’s base […]
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IRS Modifies Offshore Voluntary Disclosure Program (OVDP)
On June 18, 2014, the IRS announced new updated procedures for the voluntary disclosure program and new streamline filing procedures which in many cases substantially reduces the penalty exposure for non compliant taxpayers to 5% of the highest balance in foreign accounts and non-declared assets. I have personally worked with clients that were involved in […]
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IRS Releases Final Regulations on ACA Small-Business Tax Credit
The IRS released on June 20 their final regulations on the small-business tax credit for paying health insurance premiums for the business employees. This credit has been available since 2010 and was at a 35% maximum level until 2013. In 2014 and 2015 the credit increases to 50% for health insurance premium payments offered through […]
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Transition Period for LGM-Dairy to DMM is Announced by FSA
The 2014 farm bill now provides for a new Dairy Margin Management (DMM) program. Dairy farmers have been able to take advantage of Livestock Gross Margin-Dairy (LGM-Dairy) under current crop insurance provisions. However, the 2014 bill provides that a dairy farmer cannot take advantage of both programs to prevent “double-dipping”. In addition, the LGM-Dairy insurance […]
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Is Low Section 179 Causing Low Equipment Sales?
Most of the equipment manufacturers have released their equipment sales for the last quarter and most of them reported lower sales for the first quarter of this year versus 2013. We have seen some commentators attribute this to the current lower Section 179 tax deductions for this year and no bonus depreciation. However, when you […]
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ARC-IC versus ARC-CO
The FSA issued some regulations on the calculations of PLC and ARC late last month. This notice provides a good overview of how the FSA will determine the payment calculations under PLC and ARC. ARC is broken down into ARC at the County Level (ARC-CO) and ARC at the farm level (ARC-IC). We had provided […]