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Tax Deduction Consulting: Farm Deductions Wilmington DE

The regulations are fairly simply for someone using the cash accounting method. When the accrual method of accounting is used, it is important to note that the deductions can not be taken until the money is actually spent, or the services received, or the liability is actually realized.

Frank M. Levy (RFC®), CHFC, CLU
(302) 765-3500
205 Philadelphia Pike
Wilmington, DE
Company
Diversified Financial Consultants
Qualifications
Years of Experience: 34
Membership
IARFC, MDRT
Services
Invoice, Estate Planning, Business Planning, Pension Planning, Executive Compensation Planning, personal Coach, Retirement Planning, Tax Planning, Employee Benefits, Stocks and Bonds, Mutual Funds, Annuities, Life Insurance, Disability Income Insurance, Long Term Care Insurance, Group Insurance, Charitable Planning, Education Plan, Asset Protection, Compensation Plans

Data Provided by:
Joan L. Sharp (RFC®), CFP, CHFC, MSFS
(302) 324-5363
42 Reads Way
New Castle, DE
Company
Life Strategies, LLC
Qualifications
Education: BAMSFS
Years of Experience: 8
Membership
IARFC, FPA, SFSP
Services
Invoice, Estate Planning, Retirement Planning, Tax Planning, Charitable Planning, Asset Protection, Compensation Plans

Data Provided by:
Colbert Ball Tax Ser
(302) 543-4631
800 Vandever Ave
Wilmington, DE
 
Delaware Taxes Today
(302) 654-4848
712 N Market St
Wilmington, DE
 
Greenbank Tax Service
(302) 995-0923
210 W Market St
Wilmington, DE
 
Bill Curry
1521 Concord Pike
Wilmington, DE
Company
Company: Curry Poole Group, LLC
Type
Investment Advisor Rep: Yes
Registered Investor: Yes
Education
BS
MBA
JD
Years Experience
Years Experience: 42
Service
Pension for Highly Compensated Owners,Stock Market Alternative,Reverse Mortgage,Medicare Planning,Annuities,Alternative Asset Class Planning,Investment Consulting & Allocation Design,Insurance & Risk Management Planning,Retirement Income Distribution Planning,Education Funding & Financial Aid Planning,Hourly Financial Planning Engagements,Portfolio Engineering,Mortgage Refinancing,IRA, 401k, Roth IRA, QDRO Rollovers,CD Alternative,Alternative Investments,Life Insurance,Investment & Portfolio Man

Data Provided by:
Keith Al-Chokhachy, Certified Financial Planner(tm)
2751 Centerville Road
Wilmington, DE
Company
Title: Certified Financial Planner"
Company: Morgan Stanley Smith Barney
Years Experience
Years Experience: 8
Service
Captive Insurance,Life Settlements,Pension for Highly Compensated Owners,Stock Market Alternative,Wealth Management,Health Care Insurance,Retirement Planning,Real Estate Investment Planning,Commission-Only Financial Planning (Full Disclosure),Insurance & Risk Management Planning,Retirement Income Distribution Planning,Education Funding & Financial Aid Planning,Hourly Financial Planning Engagements,Fee Only Portfolio Management,Wealth Engineering,Mortgage Refinancing,IRA, 401k, Roth IRA, QDRO Rol

Data Provided by:
Delaware Taxes Today
(302) 888-1976
712 N Market St
Wilmington, DE
 
Fast Tax Delaware
(302) 427-2844
725 N Market St
Wilmington, DE
 
H&R Block
(302) 656-7212
106 S UNION ST
WILMINGTON, DE

Data Provided by:
Data Provided by:

Tax Deduction Consulting: Farm Deductions

Farm Deduction

The farm deduction is given to farmers who have certain expenses that are incurred in the ordinary and necessary operation of a farm. The deduction is treated much like a business deduction with some exceptions.

The information needed to calculate and claim the farm deduction is found in the Internal Revenue Code Section 62 and Treasury Regulation 1.162-12. It allows a tax deduction for expenses that are incurred in the ordinary and necessary operation of a farm. This includes maintenance of the farm, its buildings and equipment. As always, the exact definition of ordinary and necessary is sometimes hard to pin down with certainty. Usually, the majority of such expenses are certainly ordinary and necessary, but there is always going to be one or two items that appear to be on the bubble.

The regulations are fairly simply for someone using the cash accounting method. When the accrual method of accounting is used, it is important to note that the deductions can not be taken until the money is actually spent, or the services received, or the liability is actually realized. Many farmers use the accrual method which takes in account projected income and expected expenses because of the cyclic nature of the farming operation. The IRS does not recognize a deposit for seed, for example, that is not going to be received until the following planting season, as an expense in the current year.

Internal Revenue Code 464 limits pre-paid supplies if they exceed 50% of the total farm expense deduction. If the pre-paid supplies are actually used during the tax year, they are fully deductible. The intent of IRC 64 is to prevent tax payers from using farms to shelter income that is not related to the farm.

The farm deduction can be taken on certain expenses, however, that are pre-paid when they constitute an actual commitment that is binding and unchanging. There are rules set out that explain the difference between the deposit and the pre-paid expense tha...

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