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Dairy Margin Coverage for 2022

The last day for dairy farmers to enroll in the Dairy Margin Coverage (DMC) for 2022 with your local Farm Service Agency (FSA) office is Feb. 18, 2022. Dairy farmers who signed up for the five-year commitment last year and locked in their coverage still need to pay the $100 administrative fee to stay enrolled in the program. Dairy farmers can also sign up for Supplemental DMC if they have less than 5 million pounds of established production. These dairy farms can update their production to their 2019 actual production. This update in pounds is retroactive to January 2021 and will go through 2023. Dairy farmers may receive a DMC payment for all 2021 months of increased production with Supplemental DMC. The USDA has also updated the feed cost calculation from a 50 percent premium hay ration to a 100 percent premium hay ration for DMC. Depending on farm size and coverage level, your farm could have up to 95 percent of your annual historic protection with DMC. With many farms selecting Tie
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Agriculture Risk Coverage and Price Loss Coverage Webinar to be held on Jan. 26

The U.S. Department of Agriculture’s (USDA) Farm Service Agency (FSA) in Minnesota is holding a public Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) webinar with the University of Minnesota Extension at 2 p.m. on Jan. 26, 2022. Farmers and others involved in agriculture will have an opportunity to learn more about the ARC/PLC programs and factors to consider when making elections for the 2022 crop year. The ARC and PLC programs provide financial protections to farmers from substantial drops in crop prices or revenues and are vital economic safety-nets for most American farms. Producers can elect coverage and enroll in crop-by-crop ARC-County or PLC, or ARC-Individual for the entire farm, for the 2022 crop year. Although election changes for 2022 are optional, enrollment (signed contract) is required for each year of the program. If a producer has a multi-year contract on the farm and makes an election change for 2022, it will be necessary to sign a new contract. The

Farm transition webinar recordings available

by Megan Roberts, Extension educator In December, University of Minnesota Extension hosted a webinar series on introductory farm transition and estate planning concepts. Recordings of those sessions are now available for viewing on YouTube. Whether young or old, a long-time farm owner or an aspiring beginning farmer, the webinars were designed to give the basics around terminology related to farm ownership, farm transfer, and estate planning.  Webinar #1: Developing your farm transition goals and assembling your “team" Webinar #2: All things tax: gifting, selling, and transferring – What are the differences? What are the tax implications? What should I include in my farm transition plan? Webinar #3: Wills, trusts, ownership titling—What does it all mean? Webinar #4: Putting the basics together: estate, retirement, healthcare, and business transfer planning—How are they different and how are they similar? Materials from the webinars, including the slides, are available for download

Infrastructure Act signed into law, affects Employee Retention Credit for Q4

by Megan Roberts, Extension educator On November 15, the bipartisan infrastructure bill, known formally as H.R. 3684 - Infrastructure Investment and Jobs Act , became law. The wide-ranging law is, as the name suggests, primarily aimed at nationwide infrastructure improvements and transportation. In this brief summary post, I will cover a few provisions of relevance to agricultural and rural audiences and then dive deeper into a parameter of the law that affects a COVID-19 tax provision addressed previously on the Ag Business Management blog: the Employee Retention Credit.   Select rural and ag provisions While one could effectively argue roads and transportation infrastructure are inextricably linked to agriculture, for brevity, I am only highlighting a few selected ag and rural-related sections of the 1,039 page law.   Division F covers broadband internet access. In Division F, Title 1 the law outlines broadband grants for unserved and underserved locations, many of which are ru

Farm transition webinar series planned for Wednesdays at 10 a.m. in December

 by Megan Roberts, Extension educator As harvest concludes and winter begins, many in farming sigh a sense of relief as the busiest times of the year are in the rearview mirror. The colder season of the year has it own sense of busyness though. As farmers, we often use this time of year for planning and management. A sometimes overlooked part of farm management is farm transition and estate planning. If you haven’t thought about your farm transition and estate plan in a while—or ever—now is a great time start.  University of Minnesota Extension is presenting four webinars on introductory farm transition and estate planning topics this December. Webinars are held Wednesdays from 10 –11:30 a.m. and are no cost to attendees. The first hour will be a presentation, with the remaining time available for Q&A. Pre-registration is requested; meetings held virtually on Zoom. Attend one or attend all four!  Whether young or old, a long-time farm owner or an aspiring beginning farmer, these we

Tax planning webinar for farmers planned for November 30

by Megan Roberts, Extension educator University of Minnesota Extension's Ag Business Management team will present an end of year tax planning webinar for farm producers. The free webinar, hosted by Extension educators Megan Roberts and Rob Holcomb, will be held live online via Zoom on Tuesday, November 30 from 10 am to noon. A recording will be available by December 3. "2021 is expected to be a higher income year for many farm producers,” said Rob Holcomb, EA, agricultural business management Extension educator. “End of year tax planning is an effective strategy to help minimize 2021 tax liabilities.” Topics will include 2021 tax bracket updates, COVID-19 related tax credits and provisions, net operating loss changes, qualified business income (QBI) estimations, depreciation changes, income averaging, federal estate and gift tax, and tax planning. Farmers can submit questions ahead of time or participate in a live Q&A during the webinar.  Pre-registration for the webinar i

Outlook on 2021 crops

by Dave Bau, Extension educator Harvest is in full swing and yields really vary across the region and state. With a drought in place throughout most of the summer, Minnesota farmers have been left to wonder exactly what their yields will be. On top of the drought, many farmers received strong winds which caused harvesting issues when the corn broke or laid flat. While many will receive lower yields, some farmers will receive average or above average yields.   Here are a few examples. My estimated production costs per acres for 2021 were at $750 per acre for corn and $517 for soybeans, assuming land rent at $220 per acre. I will use the last five crop year averages for Cottonwood County of 188 bushels per acre for corn and 55 bushels per acre of soybeans from the USDA. For price, I will use the average price from Meadowland Farmers Coop for the past 11 months where one of my marketing groups met. The average corn price was $4.45 and soybean $11.56. Taking these prices multiplied by aver