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Showing posts from November, 2020

Transition Thursdays Webinar: Family Communication and Heritage

  by Amber Roberts, Extension educator   The intergenerational transition of farms and land requires both planning and communication. If there isn't communication on the front end, all of the planning and legal tools used will not hold in the long term.  Strong communication throughout the transition process can ensure that the wishes of the retiring generation are met and can preserve the heritage of the land and farm.  Family Resiliency Extension Educator  Becky Hagen Jokela and Forestry Extension Educator Mike Reichenbach discuss tools to help improve family communication during the transition process. They also share their personal stories of transitioning a family cabin and a 5th generation working farm to highlight the complexities and importance of family communication.  Tools for Effective Communication: Grandma's Yellow Pie Plate : This tool helps families address common decision making obstacles when passing on personal, non-titled possessions.  Getting the Conversati

PPP expenses not deductible if taxpayer believes forgiveness will occur in future

by Megan Roberts, Extension educator Since late March, Congress, Treasury, the Small Business Administration, and the Internal Revenue Service have issued regular changes to the Paycheck Protection Program. On November 18, the IRS issued Revenue Rule 2020-27 , which updates interpretation of tax deductibility of PPP related expenses in 2020. Treasury and the IRS now indicate that if a PPP recipient reasonably believes their loan will be forgiven, they should not deduct any associated PPP eligible expenses on their 2020 tax returns regardless of whether forgiveness has been received. Previously, the interpretation of the earlier issued Notice 2020-32 was that PPP associated expense deductions were allowed on 2020 tax returns if the loan was not yet forgiven. If forgiveness was later received in 2021, the previous interpretation was the 2020 deductions would then be subject to tax recapture in 2021. To reiterate, IRS now says that if there is reasonable belief by the taxpayer that a PP

Tax planning webinar for farmers planned for December 3

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 Thursday, December 3 from 2 to 3:30 pm. A recording will be available beginning December 4.  "Farm cash flow was negatively impacted by Covid-19,” said Rob Holcomb, agricultural business management Extension educator. “But governmental programs and rebounding commodity prices make end of year tax planning essential for farmers.” Topics will include Covid-19 farm relief program tax implications, estimating qualified business income (QBI), updates to depreciation expenses including Minnesota's section 179 conformity, as well as tax planning strategies. Farmers can submit questions ahead of time or participate in a live Q&A during the webinar.  Pre-registration for the webinar is required. T

Transition Thursdays Webinar: Goal Setting

   by Amber Roberts, Extension educator   Establishing individual, family, business, and retirement goals are essential to the transition process. These goals guide the transition process and help to validate decisions that are made. Without being clear and firm about these foals, the transition process will not succeed. In this webinar, Extension Educator Megan Roberts discusses SMART goals setting for your transition and how goal planning can help smooth your transition process. Writing down the goals for your farm's or land's transition, the probability of achieving them increases by 1100%. Roberts has provided a goal setting worksheet for writing down your individual goals and aligning those goals with other members involved in the transition. 

Transition Thursdays Webinars: 'Where to Begin? Assessing Transition Readiness'

 by Amber Roberts, Extension educator   Transitioning the farm business to the next generation is a process that tends to occur over a number of years and is a serious undertaking. The entering generation needs to learn how to manage the business and establish their financial position. The retiring generation needs to be willing to turn over control of the farm businesses and trust that their successor will do well. Less than 1 in 3 farms are able to successfully transition to the next generation, went not done properly, there can be serious financial and relationship consequences.  This webinar will help prepare farmers and landowners by discussing the five main areas to discuss prior to beginning your transition process.  You can take the virtual 'Getting Started' quiz which will provide immediate individual feedback and can create a report comparing your transition member's responses at . 

Dairy Margin Coverage

December 11, 2020 is the last day for dairy farmers to enroll in the Dairy Margin Coverage for 2021 with your local Farm Service Agency (FSA) office. Dairy farmers who have signed up for the five-year commitment last year and locked in their coverage need to go into FSA office and pay the $100 administrative fee to stay qualified.  Dairy Margin Coverage is an FSA program that analyzes the difference between milk price and feed cost, the margin. The United States all-milk price is used. The feed cost is using a ration calculated by the USDA using a NASS pricing for corn and blended alfalfa hay. The soybean meal uses AMS prices from Illinois. Dairy farmers can elect to cover from 5 percent to 95 percent of their annual milk production from a margin coverage from $4.00 to $9.50 in $0.50 increments. The amount of milk production is the dairy’s highest annual production between 2011, 2012, or 2013.  If they are a new dairy, they can use either the USA average production per cow, or a year