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#70223 - 05/22/06 06:46 PM Re: Does your weekend property provide income?
Rangersedge Offline
Ambassador
Field Correspondent
Lunker

Registered: 05/22/03
Posts: 837
Loc: Illinois
Not much to add... Grew up and live on a farm. About all my weekends are spent working on cattle fence and other "work" stuff so not much time for fishing. That said, I still like cattle.

Like any business though, there are fixed and variable costs and risks. Examples of each. You may need a tractor to haul hay whether you have 20 or 200 cows. The tractor is a fixed cost. The additional fuel to haul more hay is variable. Your total hay hauling cost is cheaper per head at 200. Just like using that combine on 2,000 acres instead of 200. A brother had some cattle a few miles away that turned up dead a few years back. Never did figure out why. Suspect person who had been fishing in his pond and 4 wheeler riding on his land without permission got mad and poisoned them somehow. Couldn't prove anything. Cattle prices are fairly good right now. It seems I get tax write offs every year from farming. Makes me feel good on April 15th. Then I get to thinking and ask myself, does that mean I lost money?
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#70224 - 05/22/06 09:05 PM Re: Does your weekend property provide income?
Theo Gallus Offline
Moderator
Lunker

Registered: 05/14/04
Posts: 12394
Loc: Central Ohio
Not if you're doing a lot of depreciation.
_________________________
"Live like you'll die tomorrow, but manage your grass like you'll live forever."
-S. M. Stirling

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#70225 - 05/22/06 09:24 PM Re: Does your weekend property provide income?
Steve M. Offline
Member

Registered: 03/13/06
Posts: 11
Loc: louisiana
this is probably not much help but i sold 2 cows today at auction in baton rouge,1 was 505 pounds and the other 521,both brought 1.06 per pound.i paid 100.00 per calf and put them on approx.6 acres of grass for about 16 months.spent very little on feed and hay, and chased them from one end of the parish to other at all hours of the night.LIVE ANF LEARN.

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#70226 - 05/22/06 09:31 PM Re: Does your weekend property provide income?
Dave Davidson1 Offline
Moderator
Lunker

Registered: 01/04/06
Posts: 13600
Loc: Hurst & Bowie, Texas
Gator, Like Steve M., I found cattle to be a major pain in the butt. I got a call in the middle of the night saying my cows were out. OK, it had been happening a lot so I got up and drove 70 miles on sorta icey roads. When I found the cows, they weren't mine. I got rid of them.
_________________________
It's not about the fish. It's about the pond. Take care of the pond and the fish will be fine. PB subscriber since before it was in color.

Without a sense of urgency, Nothing ever gets done.

Boy, if I say "sic em", you'd better look for something to bite. Sam Shelley Rancher and Farmer Muleshoe Texas 1892-1985 RIP

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#70227 - 05/22/06 11:21 PM Re: Does your weekend property provide income?
Meadowlark Offline
Lunker

Registered: 03/09/04
Posts: 3075
Loc: East Texas
 Quote:
Originally posted by Alligator:
Do you have any more details on the difficulties of obtaining a Wildlife Exemption?
Gator
Gator,

No, sorry don't have the details. The agent told me, in regard to some recently purchased property, "you don't want to go through the red tape associated with the wildlife exemption". He mentioned inspections and documentation and that was all I needed to hear. Also, it didn't seem to make a lot of difference in taxes, so I opted for ag. ememption on part and timber on other part.

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#70228 - 05/23/06 07:27 AM Re: Does your weekend property provide income?
Dave Davidson1 Offline
Moderator
Lunker

Registered: 01/04/06
Posts: 13600
Loc: Hurst & Bowie, Texas
There are no tax differences between Ag and Wildlife exemptions.

I had to fill out a form listing that I was doing 3 out of the 7 wildlife related criteria. It was simple. I anticipate less inspections. Prior to my change from Ag, they jumped my fences every year to assure that I still had cows. Unburnt brushpiles for rodents, bird houses, feed patches, shooting feral dogs and cats, etc. qualify. It's actually a no brainer. However, you do have to have a current Ag exemption to make the change.
_________________________
It's not about the fish. It's about the pond. Take care of the pond and the fish will be fine. PB subscriber since before it was in color.

Without a sense of urgency, Nothing ever gets done.

Boy, if I say "sic em", you'd better look for something to bite. Sam Shelley Rancher and Farmer Muleshoe Texas 1892-1985 RIP

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#70229 - 05/23/06 11:43 AM Re: Does your weekend property provide income?
rockytopper Offline
Lunker

Registered: 01/20/05
Posts: 1239
Loc: texas
Steve M wrote "and chased them from one end of the parish to other at all hours of the night."

Gator Word of advise they can be a pain at times,however if you do decide to go into the Cattle business don't be a cowboy that's for movies with John wayne. The trick is to train the cattle to be led not herded. When you feed them use a call, truck horn, holer, bell, what ever. Even if they get out it is easier to get them back by simiple calling them in not chasing them in. I learned this from my Grand Dad growing up as a plow boy not a cowboy. I holer "suck cow, suck cow...." They come running and you better be ready.
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The road goes on forever and the party nevers end...............................................

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#70230 - 05/23/06 02:34 PM Re: Does your weekend property provide income?
bigfrog Offline
Member

Registered: 05/24/05
Posts: 27
Loc: SE Missouri
The CRP might be another option for some. My property consists of about 90 acres, about 50 of which is wooded or in ponds and about 40 was in pasture. When I purchased the property, it was in the Conservation Reserve Program (CRP). This program pays you annually to establish conservation practices on existing farmland. I think that my land qualified because the pasture portions had been previously farmed. I would think that a history of hay or cattle production would probably work as well. This program has worked great for me because the CRP provided cost-share assistance to establish wildlife-friendly cover (ladino clover, etc.) in a pasture that was largely fescue. Once planted, they then pay you annually on a per acre basis. I understand the rates may be changing based on soil type, but I currently receive about $80 per acre. There is some maintenance (mowing, strip discing, etc., based on your choices and plan), but there is cost-share assistance on that as well. In Missouri, you enter into a 10 year contract during which you agree to do the maintenance and they agree to pay you the rent. The net result is that I get a modest agricultural income from my land which allows me to deduct lots of items for tax purposes and I have a very large, wildlife-friendly "food plot" which furthers my goals for the property. Here is a link to the CRP website...

http://www.fsa.usda.gov/dafp/cepd/crp.htm
_________________________
2ac, 1ac, .5ac, .3ac,

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#70231 - 05/24/06 11:21 AM Re: Does your weekend property provide income?
will Offline
Lunker

Registered: 07/14/03
Posts: 59
Loc: Fredericksburg, Texas
Gator: Here's my two cents lease the grazing out for cattle until you get the ag exemption,(less cowboying work on you). Then maybe go 1/2 wild life ex. & hay pature-ag ex., if you don't like the effects of the cattle. Note: the cows don't have to be there 24/7/365 ,you can rest a pasture at times.

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#70232 - 05/24/06 05:52 PM Re: Does your weekend property provide income?
Alligator Offline
Lunker

Registered: 03/30/05
Posts: 821
Loc: East Texas
Thanks for the input everyone!

I think I'm leaning toward leasing out for grazing rights as a first step - not 100% sure I want the headaches of owning the cattle. That will at least fulfill my requirements for the Ag Exemption...for now. I can always get cows later if I change my mind.

I suppose if I lease it out for grazing rights - that may limit my tax write-offs vs running cattle on my own?

Will (and others) - Is there a reason that I wouldnt roll the entire property into the Wildlife Exemption vs. 50/50 as suggested above?

Gator
_________________________
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#70233 - 05/25/06 11:12 AM Re: Does your weekend property provide income?
will Offline
Lunker

Registered: 07/14/03
Posts: 59
Loc: Fredericksburg, Texas
No, But I think with the wildlife exp. being fairly new in TEXAS(about 10 years old) It wouldn't surpised me if our state & county reps. will try and take away some of the it's tax exemptions. As more & more land falls under it, they will not want to let their income ( tax $s payed by us) get to low.Also with an ag exemption you may have more write offs come April 15th. Plus it can,in a good year produce more income.
In a Nut shell I think its better to diversify
"more that just 1 kind of fish in the pond"

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#70234 - 05/29/06 10:40 PM Re: Does your weekend property provide income?
ilovefishingmark Offline
Member

Registered: 04/21/03
Posts: 271
Loc: mtn. home, arkansas
gator, find a good accountant. i have about 55 acres, with a 4 acre pond. i use it as a farm expense...so fertilizer, seed, mowing, tractor, kawasaki mule, 4 wheeler, on those toys you are going to buy anyway are deductible to some extent. fencing, dozing, etc also. now, don't go out and buy 50k worth of trucks and toys just so you can say "well if i don't spend the money, uncle sam will get it". that is not the way it goes. a lot of people say that, but it really is not that smart. however, if you plan on having an expense of some sort anyway (hunting property with toys...4wheelers, seeding plots, fertilizer, etc..) then find a way to use it as a farm. also, the more property you have the more reasonable cows are. if you have a smaller piece of property...5-50 acres...you may find that horses may be a better "livestock" option. i...am scared to death of horses, and don't want any...but if you really like them...that may be an avenue for you to pursue. they are hard work though...and you really have to want them.

find yourself a good accountant/cpa... take what we all say with a grain of salt, and listen to a professional cpa that you can trust.

i believe the irs has, in the past, been somewhat "leniant" on farmers...so check into the farm situation.

also, ask your accountant about bartaring and farming (i.e. you provide 10k worth of property use/feeding to someone, and they provide 10k worth of fence improvements, seeding, dozing etc...) these are all possibilities that could add expenses/losses withouth really exchanging any money.
....or something like that!!

mark

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#70235 - 06/01/06 12:22 PM Re: Does your weekend property provide income?
TEXAS715 Offline
Lunker

Registered: 06/06/02
Posts: 352
Loc: Texas
bartering still produces a tax liability, 1099-B, but you don't have the cash outlaw for the work. If you lease it out make sure you get it in writing what the conditions are (number of head, amount of time on pastures, term of contract, price). avoid a lot of the headaches later if there is a dispute. been there done that.

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