Forums36
Topics40,944
Posts557,782
Members18,481
|
Most Online3,612 Jan 10th, 2023
|
|
10 members (Augie, Bill Cody, Groundhog7, Sunil, gehajake, CentexSaj, catscratch, wps456, teehjaeh57, Shorthose),
886
guests, and
239
robots. |
Key:
Admin,
Global Mod,
Mod
|
|
|
Joined: Mar 2004
Posts: 1,721
Lunker
|
OP
Lunker
Joined: Mar 2004
Posts: 1,721 |
At the pond boss convention which was a great success, I spoke with Sherman Wyman. We talked about taxes and he told me I needed to make more money in order to be able to write off all the things that go along with a farm. I presently have 14 cows that have calves to sell but its not enough. He gave me three suggestions a pecan farm, a vineyard or begin selling some fish. Does anyone else have any suggestions?
|
|
|
|
Joined: Jan 2006
Posts: 16,050 Likes: 277
Moderator Lunker
|
Moderator Lunker
Joined: Jan 2006
Posts: 16,050 Likes: 277 |
Are you depreciating your tractor? What about other stuff like fence, etc.?
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
|
|
|
|
Joined: Mar 2004
Posts: 1,721
Lunker
|
OP
Lunker
Joined: Mar 2004
Posts: 1,721 |
Dave I am depreciating the tractor and my new pipe and cable fence but I built a new barb wire fence myself and wrote off the cost of the materials. Sherman just said I need to make some money to offset the cost of all I have bought.
|
|
|
|
Joined: Feb 2006
Posts: 609
Lunker
|
Lunker
Joined: Feb 2006
Posts: 609 |
I got to write off my tractor this year it saved me from having to pay any more money then they already got from me. I do use my tractor in my lawn service also just starting to do some bush hogging.
You can pay more but you cant buy better.
|
|
|
|
Joined: Aug 2006
Posts: 264
Lunker
|
Lunker
Joined: Aug 2006
Posts: 264 |
Pond Maintenance! Because all my ponds are a source of livestock water, I am allowed by my accountant (Ex-Father-In-Law) to write off last years pond renovations. New pond construction in my case is not tax deductible.
Pond Boss subscriber ever since I joined the forum. Thanks Bob!
|
|
|
|
Joined: Jan 2006
Posts: 160
Lunker
|
Lunker
Joined: Jan 2006
Posts: 160 |
My brother works for an accounting firm and he says there's not a specific figure on the income, just that you have to prove some income or loss. We are dealing with this issue too, spending a lot of money on property that isn't producing any income. We are thinking of maybe selling some pecans and/or raspberries and blackberries this year.
|
|
|
|
Joined: Dec 2006
Posts: 342
Lunker
|
Lunker
Joined: Dec 2006
Posts: 342 |
Tree farming has several benefits: ag exemptions plus you get to enjoy the habitat that it provides. We raise pine trees in East Texas and also have a small cattle ranch. My accountant advises that you can expense relevant expense but it must be moving you closer to making a profit at some point in time. We are in the process of converting our commercial cattle to a registered breeding program which will generate a higher per head revenue base.
"Our Life is frittered away by detail. Simplify, Simplify" -Henry David Thoreau -
|
|
|
|
Joined: Sep 2004
Posts: 102
Lunker
|
Lunker
Joined: Sep 2004
Posts: 102 |
You can lease land for grazing. You can sell coastal hay. If you have a close friend or relative with a business--lease the business hunting or fishing rights--this can create a paper "income" for you and an "expence" for the business.
|
|
|
|
Joined: Jan 2005
Posts: 1,239
Lunker
|
Lunker
Joined: Jan 2005
Posts: 1,239 |
Info from the IRS about farm deduction http://www.irs.gov/publications/p225/ch04.html#d0e5380 It does not state the amount you have to profit in order to take the deductions. 14 calves is more than enough. Basically you have to show that you are trying to make a profit. This can easily be achieved. Also be aware you live in Texas, we have been in a sever draught for several years. Every farmer in my county, even the largest, has lost money the last couple of years. I know I did. I generally sale calves and hay. Last year we made about 1/4 the hay of normal years. There fore I had to feed all of the hay I made and then buy feed at increased prices just to stay in business. If the "DRAUGHT" is not responsible for my losses to circumstances beyond my control then I don't know what would be. If you shoot for the 3/5 yr rule. Just hold your calves back and sale every 2 years =28 at current prices that's about 8k to 10k$. You will end up with a profit 3 out of 5 years as the rule allows.
The road goes on forever and the party nevers end...............................................
|
|
|
|
Joined: Mar 2005
Posts: 61
Lunker
|
Lunker
Joined: Mar 2005
Posts: 61 |
James, after a brief telephone follow up with my tax man this past Monday, following Sherman's informative, yet sobering presentation, another possibility is any interest expense for the land loan.
It is deductible up to the amount of any interest earned, including dividends etc, as long as the land is held for investment purposes.
Another route is building a second home up there and deducting 100% of the home and land interest portion of the note, and this is not governed by any earned interest income. After looking at the numbers, it maybe a alot easier than some other alternatives.
|
|
|
|
Joined: Dec 2004
Posts: 5,713 Likes: 35
Administrator Lunker
|
Administrator Lunker
Joined: Dec 2004
Posts: 5,713 Likes: 35 |
The less income the better. All you need to do is get a fake Social Security number for every animal, building, or whatever that sits on your place. These are your dependents. The earned income credit alone will make you a happy. It is the illegal alien way! :p
|
|
|
Moderated by Bill Cody, Bruce Condello, catmandoo, Chris Steelman, Dave Davidson1, esshup, ewest, FireIsHot, Omaha, Sunil, teehjaeh57
|
|