Year End Tax Advice

With less than a month away from year-end, farmers and ranchers need to be considering what their income and expenses will be come December 31st. CliftonAllenLarson principle and Farm CPA Today blogger Paul Neiffer shares some tax advice as we draw closer to year’s end.

 

Neiffer: “What farmers need to be cognizant of as we get closer to year end they need to have a pretty good road map as to what their income and their deductions are looking like. Most farmers have their accounting on some type computerized accounting system. Really what you want to do is take where you are right now — say you are at $100,000 of income and your goal is that you want to be at $50,000 of income. You want to project what income do you have coming in before year end. How much cash expenses do I have going out? What is my depreciation? Have I bought some fixed assets this year? You’ll have depreciation from prior year assets, plus any Section 179 or bonus depreciation or regular depreciation on current year assets.”

 

Neiffer says if after all that planning you are still not at the number you want to be at, consider looking at doing some pre-payment of farm or ranch expenses. It does need to be specific, though.

 

Farm CPA Today is one of my favorite informative blogs, if you haven’t yet visited it, go to Farm CPA today.com.