Tax Issues

Begin with a professional (CPA)

• They must have knowledge of the farm industry

• They are an integral part of your business

Choose a tax structure

Profitable farms will usually have a tax savings when using a C-Corporation structure

• C-Corporation

• S-Corporation

• Limited Liability Company

Best time to plan is after harvest

• Use actual crop yields

Result should be a written plan

• What will be done

• Expected tax effect

• No surprises

Self employment tax

• Individual farmers pay more self-employment tax than income tax

• Would you choose to keep paying into Social Security

• Alternatives to fund your own retirement: Ira, Keogh, SEP IRA, Simple IRA

Other payroll taxes