Who said your CPA was wrong. You have/had CRP. No issues at all. Perfect.
Farm Contract Recommendations
- Thread starter CottonwoodCanyon
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Probably getting to the bottom line the same with different schedules, not sure.
It can make a difference for sure in other aspects. Just one example, in my county you cannot put up a pole barn/ag building without a house UNLESS you have a schedule F. Yes they make you submit it.
It can make a difference for sure in other aspects. Just one example, in my county you cannot put up a pole barn/ag building without a house UNLESS you have a schedule F. Yes they make you submit it.
Windlooker
Well-Known Member
Idk. I also think some cpas are more aggressive than others. Of course that doesn’t protect you. You gotta pay if they F up. Maybe I’ll get called on the carpet one day but it’s been ok for 22 years. I may be not understanding. I have always filed schedule F due to crp income. Are you saying that straight rent with no income is the difference??
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Hardwood11
It is going to be a good fall!
My farm income goes under Schedule E according to my accountant .
Hardwood11
It is going to be a good fall!
You might be accurate on the schedules. I do not submit on F.
I could be wrong, and that's fine.
Maybe my CPA is just less aggressive than yours. I do know CRP is different for sure.
Windlooker
Well-Known Member
I submit under F. Maybe there is a difference. My bad if there is. I’ve always had crp income. Recently I started to rent as well.
booneriverbucks
PMA Member
Anybody else think it’s dumb this is a discussion?? We all are getting screwed if we are debating taxes on stuff like this!
Hardwood11
It is going to be a good fall!
I guess it depends on if you have 20 acres with 2 tillable—or a big farm/farms with a lot of crop land or CRP ?
If the IRS wants you to report the income you should maximize the deductions! I treat it as my second business.
booneriverbucks
PMA Member
I am in no real position to give tax and legal advice!!! Haha. It’s just my general belief that if our government is concerned about this our government is way to big than what was originally intended
deerdown
Well-Known Member
Our leases always have a specific end date, stating no further notice required. That way you don't have to remember to give notice by Sept 1 or whatever the states guideline is.
Instead of soil samples to maintain fertility, we use harvest yields and Agphd app to determine what tenant needs to add to make up any shortfall. This requires yield tickets and fertilizer tickets. We also have minimum fertilizer reqd to start the year.
Rent due feb1, gives you time to find another tenant need be.
Corn/bean rotation
Edited for spelling.
Instead of soil samples to maintain fertility, we use harvest yields and Agphd app to determine what tenant needs to add to make up any shortfall. This requires yield tickets and fertilizer tickets. We also have minimum fertilizer reqd to start the year.
Rent due feb1, gives you time to find another tenant need be.
Corn/bean rotation
Edited for spelling.
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CottonwoodCanyon
Well-Known Member
@deerdown @JNRBRONC @Hardwood11 and anyone else, would anyone be willing to share their contract? Obviously remove $ and acreage, any personal information, and anything else you'd prefer not to share, all I'm looking for is how you worded these items. Appreciate all the help here guys! Even the E vs. F and tax debate is very helpful. We are fairly new to owning our own land so this is great information.
sep0667
Land of the Whitetail
I have 30 acres tillable rented out. I am far from an expert and Im sure am missing/doing things wrong or could be better. I just had a lawyer write up an agreement with the things I wished for. Its pretty simple. I just made sure to include things like: I maintain the hunting rights, no cutting trees/brush, no livestock, the agreed $ per acre. I dont think I have anything about the soil health etc. I feel I have a good relationship with my tennant and I know he is out there spraying/ fertilizing etc the same as his farm that borders mine. Its small enough acres to me that I feel okay with how it is. If I had big acres I'd look into it more.
edit: I also have my tennant certify the crop acres, so i can build history to enroll in crp on day if I want. I think you have to have 6 years crop history
edit: I also have my tennant certify the crop acres, so i can build history to enroll in crp on day if I want. I think you have to have 6 years crop history
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JNRBRONC
Well-Known Member
It has been over 20 years since cash rent, went the custom farm route instead.
I just downloaded a template from Iowa State and used it as a base: https://www.extension.iastate.edu/agdm/wholefarm/html/c2-16.html It’s worked for me.
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JNRBRONC
Well-Known Member
Being cheap, I have a feeling that we used that form.
deerdown
Well-Known Member
I started with the IA State template as well...
Not much to add other than I have started to have tenants sign a release of all documents pertaining to the farm and tract # on the lease. Never was a problem until recently now FSA considers yield and acres under confidential to the producers. I also have the producers sign a release for a future Crp signup. In the event a tenant is terminated they could still hold up a Crp application by not signing off. The Realestate/Farm management Co I work for terminates all tenants every August 15 and reevaluates the leases. The owner of our management Co even terminates his brother the Tenant each year.
deerdown
Well-Known Member
Those are some good adds. I question the termination of lease every year tho, a tenant might not be as willing to put in crossings, put down lime, make other improvements if they feel the lease is short term and might be taken from them next year.....just my thoughts on it... I used to do a modified version of that in the past where I'd do a 5 year lease, that had to be signed each year for renewal to ensure tenant was in compliance of the lease. I got away from that for the reasons stated.