Farm Operations
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Losses Can Offset Investment Income
Another nice feature of the final net investment tax regulations released last week is that certain losses are now allowed to offset other net investment income. In the original proposed regulations, you could not have a loss (such as the sale of stock) reduce your other net investment income. Once you reached zero, you were […]
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Bonus Payments Are Ordinary Income – Not Capital Gains
The Tax Court issued the Dudek case today concerning whether upfront bonus payments received from an agreement to allow an oil and gas company to lease property is considered ordinary income or capital gains. In the case, Mr. Dudek, a CPA (why are some CPAs more likely to go to tax court when they know […]
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More Good News on Calculating Invesment Gain
We will probably be doing a few posts this week on the net investment income tax regulations issued by the IRS last week. The IRS also issued new proposed regulations regarding how to calculate the amount of gain required to be included in investment income when you sell a partnership or S corporation interest. In […]
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Final Net Investment Income Regs Have Good News For Farmers
We have had several posts in the past about how the proposed net investment income tax Regulations indicated that cash or crop-share rents paid by a farmer’s operation to him or a pass-through entity would be subject to the 3.8% net investment income tax. In Final Regulations issued earlier this week, the IRS changed their […]
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Senate “Pool” Process to Increase SE Taxes?
The Senate proposals on tax reform contain a new method of computing depreciation as discussed in our last post. With this new pooling process, it appears that in many cases, farmer’s self-employment taxes will be greater than under current law. For example, if a farmer purchased a new tractor in 2010 for $300,000 and fully […]
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Senate Proposals on Depreciation
We posted yesterday on the new Senate tax reform proposals and how it might affect farmers. Today’s post will dig even further into the depreciation changes. First, the positive is that Section 179 has been increased to $1 million from the current $500,000. The proposal also extends the $500,000 limit through 2014 with the new $1 […]
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Day 1 of the NW Co-op Council Meeting
The following post was written by David Enquist from our Moses Lake, Washington office. The original plan was for me to be in Portland yesterday with him, but I ended up in Michigan and then to top it off, the plane out of Detroit was a late plus a strong head-wind meant I missed the flight […]
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Day 12 of my Business Trip
I am sitting at the Detroit airport ready to head onto Portland, Oregon for the Northwest Coops annual meeting tomorrow and Wednesday. That is done at noon on Wednesday and then finally home after 14 days on the road. The early part of the trip was in the St. Joseph, Missouri area and off to […]
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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. […]