Just Builds His Own May Have Been More Profitable.Taxes
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ers "-.312 ers .. rs "--'340s I ........ '444; .... '*523 en' Il fern...... '86°2 2 !hes,.. 4174 ,heifers, ll ers....... '//s, fifers.-,,, en....la4 ; ....... heifers- "i3° ?.rs" ............. 409, ?Is ..... 13th year no. 40 December 5, 1967 ...... 4S2' ers ... 420', ...... 5: . :ers ..... t Sp ..... COWS -1013 is....... Year-End Strategy Can ......... %0',3 Save Tax Dollars 1293'3 ......... Farmer Green had a fine corn rates, the less a farmer's net 9331.. crop this year and received a income fluctuates from year to --1103, good price for his hogs, so his year, the less income tax he income will be higher than usu- will pay over a period of years. al. Thus, the goal of tax manage- .......-8602 Farmer Brown's wheat crop ment is to "even out" your an- vs --_-----816 was poor and he lost money on nual income over several years. ifs ....... cattle, so his income will be far The result will be more dollars below his average. left in your pocket after you Both these farmers - and pay your taxes. most others - can use smart Tax management in the long AMISSI(1) income tax management now to run is an effort to maximize help themselvesfinancially, "after-tax" income and net NY says John H. Coolidge, Exten- worth. In the short run,itis sion farm management econo- an attempt to maintain an an- mist at Kansas State Univer- nual net income at least equal sity. to the year's allowable non -bus- Some of the most important iness deductions and personal )I.Ma decisions affectingthisyear's exemptions, and yet avoid ex- income taxes will he made be- tremely high taxable income. fore the end of 1967. That's It is equally desirable to have why December is known as a net income which approaches Ka "Tax Management 'Month." or equals the maximum earn- Because of graduated tax ings eligible for Social Secur- ity credit, says Coolidge. This figure is $6,000 now, but may be raised by Congress at any Here's How Loss time. Tax management has some F Salim Carryover Works limitations, however. If you Lose money in your farmingmake decisions and transact operation this year? If so, youbusiness solely in an effort to may be able to recover some ofreduce taxes, your net income f the income tax you paid duringafter taxes may be lower. Only the last 3 years. For example, you may make John H. Coolidge, farm man- it11:00 a.m a decision that saves you $100 ler they are agement economist at Kansasin income taxes but costs you State University, points out thatmore than this amount due to an income tax provisionwill a lower selling price for a farm help soften the blow for farm- product. 12300 1 cow ers who were "in the red" for Frequently, there is no con- f sir 6600 any one year. flict between a wise tax deci- f his 5800 Leonard Stirnof Tescott The net operating loss -carry -sion and a good farm business f hh. 4100 back provision allows you todecision. But when you face a use such a loss to recover taxeschoice, make the one resulting paid on income in years whichin the larger net income after hogs 225 0 '",; Just Builds His Own may have been more profitable.taxes. hogs 2240 You may even be able to use the For more information and dol- hi hogs 2600 15i,; loss to lower your income taxlar -saving ideas, pick up a copy 2430 I by Kenneth Greene in the last 20 years. This machinemay have ix hogs Twenty years last corn row though;Stirnis during the coming years. of "Income Tax Management 111 ago Leonard Stirn of Tes- seen its imphogs220 @ cott decidedto build a field cutter. The cut- dreaming of building a self-propelledjob be- Here's how it works. Supposefor Farmers" from your county hogs235 @ ters down time. mp lid at the implement dealers just fore another silo -filling you have a loss of $6,000 thisExtension agricultural agent. 229@ didn't suithim. first built his field ix hogs When Leonard Stirnpulled behind for the year. You may carry it back 3 227 @ '"; For one thing, theyonly cut one row at cutter, he used trailers ix hogs a time, and Leonard changed to using years to 1964 and apply it 222,a, thought there was a bet- ensilage. Later this was Judge Rules For ix hogs ter This speeded up against the taxable income of 258@ way. He got a used two -row corn binder trucks alongside the cutter. ix hogs 5,1 and a stationary ensilage cuter. He cut the the operation considerably. automatic end - that year. mphogs2200 feed troughoff the cutter and the bundle This year Stirn built new Say your taxable income forScully Tenants gs35 The endgate has arms Inp .0 14 carrier and knotter gates for the trucks. ed the two off the binder, then weld- the side of the truck. 1964 was only $2,000. You would MARION - Holders of Scul- hogs 229@ together. He mounted a motor on which are hinged on Ill the frame the top of the endgate still have $4,000 of the loss toly leases in the Marion County ix 222 t to run the cutter but left the bind- Cables fastened to hogOgshoS 1 ,1 er part front of the truckbed on pul- apply against your income forarea have gotten, some assur- gs214: geared to the tractor power take -off. run over the the ix This machine other end fastened to 1965. ance that they have more than through with several modifications leys and have the 'p141 the years has been going ever since. truck frame. If your income for 1965 was ordinary tenant rights, accord- ix Pigs Various When the truckframe raises, thecables ix Pigs n116 binder parts have been replaced, but the endgate up out of the only $1,000, you still have $3,000ing to a decision handed down 0, automatically pull the [Lx pigs 5, ter hassection is original. The ensilage cut- considerable time. On long left over to be applied againstby United States District Judge ferentbeen replaced twice and several dif- way. Th's savessilo it saves enoughtime taxable income for 1966. George Templar. [X r motors have been used. The present hauls to a trench one evenhas a starter on it. for two trucks todo the job of threewith If 1966 income was only The case before Judge Temp- Needless $2,000, you still have $1,000 losslar involved land being acquired experiencedto say, this hybrid has made an ordinary endgates.got the idea fromDarwin on the lookwelder out of Stirn. He is always He originallyfarmer from nearSalina. to carry forward and apply by the federal government for hasn't found-out for repair parts but he still McCall, anotherwill soon have plansand a against your income for thethe Marion Reservoir. that "instruction book." Stirn and McCall build 11111111 He takesa lot of ribbing from the crew, materials list onsale to help anyone next 5 years, or until all of it Basically the decision affirms but they'lladmit he's put up a lot of feed their own. is used to offset income. a leaseholder's special interest Some adjustment of taxablein a Scully lease and his right to ;51°N 611 income of prior years may beshare in settlement when the required, says Coolidge. He land is acquired in condemna- ld us'I() recommends that you see a tion. qualified tax consultant or an Scully landholdings are most rnPh°Tie Year-end Can SaveYouDollars Internal Revenue Service agentprominent in Marion County but 211 Tax Management - SeeStories In This Issue to help you apply the net oper-are also in Geary, Dickinson and ating loss provision. other G&G area counties. SharpPencilCan Maneuver Taxjsw- Manage It's that time again. Farmershere are several ways toin- - Do off -farm are approaching the endof an-crease income. work_ or .custora other business year when man- - Sell grain or livestock be- Buyfeedercash to Incr agement decisions can have afore the end of the year. Sales inventoryproperty or other which major effect on the amount ofof livestock in December may increase in would value bythe their income tax. be desirable from a tax stand- th_eyear. end of SS Ben' John H. Coolidge, Extensionpoint, although at li g h t e r r as fewdeductible farm management economist atweights the total sale price may currr ex. Kansas State University, sug- be lower than if you sell later. the balance far I litego gests that farmers sharpen their - Cull yourdairy or breed- all pencils and bring their businessing stock and sell before the crops, and supplies livestockInclude, st:17:- at fullval records up to date. end of the year. ue in the endinginventory. .00 If you make an accurate ac- - Sell any capital items no If youwant to hold counting of income and expen-longer needed in your farm bus-this year's inccme, down use meth. ditures before the end of theiness. ods just theopposite of those tax year, it's easy to estimate - Collect money due for la-grain ands wouao sad income and expenditures for thebor or custom work done. listed above.Delay sales balance of the year. - If you are eligible, takegrain and livestock of until l';: With this estimate and an a CCC loan on as much grain asPurchasefeed,fertilizer, evaluation of inventories, youyou want to have in this year's other supplies and and pay for them can buy or sell, thereby adjust-income. before the endof the ing taxable income to your best Pay only half your persan- all charge accountsyear.