Farm Rental Details on Section 199A Released
Earlier this month, the U.S. Treasury and IRS issued final 199A regulations. Because they were released in 2019, taxpayers have the option of following the proposed regulations or the final regulations for taxable years ending in 2018. The new rules clarify some issues but leave others unanswered.
The Impact of the Section 199A Transition Rule on Patrons of Cooperatives
In March 2018, provisions to Section 199A of the Tax Cuts and Jobs Act (TCJA) were amended to remove the tax incentive to sell grain to a cooperative, and was coined as the “fix to the grain glitch.” These provisions also created a transition rule that could significantly impact a cooperative patron’s 199A deduction. The […]
Agriculture improvement act of 2018 approved, waiting for President’s signature
The U.S. House and Senate recently approved the Agriculture Improvement Act of 2018 (H.R. 2). The President has indicated he will sign the bill, which is projected to cost $867 billion over ten years. The legislative text and the Statement of Mangers are available here. The National Council of Farmer Cooperatives has outlined the highlights […]
What’s new for Farmers in 2018?
The Internal Revenue Service recently released a fact sheet covering many changes happening for farmers, many due to the Tax Cuts and Jobs Act (TCJA). Below outlines what is changing for tax rates, methods of accounting and capitalization, deductions and losses. Tax rates Income averaging Tax rates have changed, and you may want to consider […]
Farm Rental Net Income Qualifying For IRC §199A Deduction
The Tax Cuts and Jobs Act, TCJA, includes a 20% qualified business income (QBI) deduction, which at first glance, seems to be straight forward. However, upon further inspection into the deduction, there are many complexities that enter into computing what the deduction can mean for individual taxpayers. One such complexity is whether farm rental income […]
Agriculture Producers Eligible for Direct Payments Need to Act Now
Earlier this summer, Agriculture Secretary Sonny Perdue announced a $12 billion program to help farmers who are bearing the brunt of unfriendly and illegal tariffs that have been imposed on the United States in the past few months. We recently asked firm partner Mike Regan how agriculture producers can take action to receive aid. Mike […]
Proceeds from an Easement or Right-of-Way
When you hear someone talk about building new pipelines or wind turbines, they often refer to securing an easement or a right-of-way. Farmers and ranchers are increasingly receiving easement, or right-of-way payments for expanded roadways, pipelines, wind turbines, electrical towers and similar permanent improvements that have a permanent impact on the use of their property.
Tax Reform Impact on Iowa Agribusiness
On May 5, 2018 the Iowa Legislature passed S.F. 2417, which provides a substantial change to the tax code of Iowa. The governor signed the billed into law on May 30, 2018. While most provisions to the new tax policy are far off and contingent, it’s important Iowa agricultural producers understand what has changed and how it will impact them. Key provisions impacting the industry include:
199A Grain Glitch Fixed with Passage of Omnibus Bill
Many legislators from agricultural states like Iowa have been fighting to fix an unintended consequence that was written in the 199A tax provision giving farmers a tax incentive to sell their products to cooperatives over other types of businesses, like private elevators.
Live Updates from National Council of Farmer Cooperatives Annual Meeting in New Orleans
BerganKDV partner and agriculture industry expert Mike Regan is currently attending the National Council of Farmer Cooperatives Annual Meeting in New Orleans. Below are updates from Mike on what he is learning at the conference: Thursday, February 8 – 11 a.m. – Update on 199A Deduction: Since the Section 199A fix was not included in […]