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Started By
Message
Starting a buisness (farming) and curious where to start
Posted on 2/17/17 at 4:12 pm
Posted on 2/17/17 at 4:12 pm
I really have no idea how to do this or what needs to be done. Id like to set it up so I can write off business expenses and protect personal assets. Business owners will be me and my wife so no real issues with feuding partnerships
I know I will need a tax ID but should I make it an LLC, Partnership/Co-op, LLp, etc?
TIA
I know I will need a tax ID but should I make it an LLC, Partnership/Co-op, LLp, etc?
TIA
Posted on 2/17/17 at 4:32 pm to FelicianaTigerfan
You talking a little tree farm on the family land or you talking commercial row crop?
Posted on 2/17/17 at 4:46 pm to GREENHEAD22
Yeah what type??? All I can say is we take out a million dollar loan every year ... Actually I think it's a line of credit that we draw from. I cook/clean/take care of the kids and husband takes care of the farming and business side that comes with it.
Posted on 2/17/17 at 4:57 pm to FelicianaTigerfan
I'd set it up as either a partnership or just you and your wife in business together so that you can qualify for more than one FSA payment limit (for in the event that a disaster happens in the area and government payments are made to you).
Also, go by your local FSA office and talk to them about Beginning Farmer loans for things such as operating expenses. They are practically zero interest and the limits will be way higher than anything you'll need.
NRCS also has a few programs out there that you might qualify for: CSP, EQUIP, etc., that you should definitely look at. All of these government programs and offices are here to help in some way. Use them.
Also, BUY INSURANCE. No matter what you're farming, I can't stress it enough. Buy insurance. If you're row cropping read up on the ARC and PLC (and STAX if you plant cotton) programs.
That's all I can think of right now without more info on what kind of operation you're running.
Also, go by your local FSA office and talk to them about Beginning Farmer loans for things such as operating expenses. They are practically zero interest and the limits will be way higher than anything you'll need.
NRCS also has a few programs out there that you might qualify for: CSP, EQUIP, etc., that you should definitely look at. All of these government programs and offices are here to help in some way. Use them.
Also, BUY INSURANCE. No matter what you're farming, I can't stress it enough. Buy insurance. If you're row cropping read up on the ARC and PLC (and STAX if you plant cotton) programs.
That's all I can think of right now without more info on what kind of operation you're running.
Posted on 2/17/17 at 5:16 pm to tiger91
You take out a million dollar loan every year? And make enough to survive?
Posted on 2/17/17 at 5:28 pm to StringedInstruments
It has to be a line of credit. They wouldn't be in business if they had to get a loan for a million every year.
Posted on 2/17/17 at 5:54 pm to VABuckeye
It doesn't take long to run through a million in farming. Our seed and fertilizer expenses alone this year were about half a million, and we're not close to the biggest operation in our area.
Posted on 2/17/17 at 7:34 pm to FelicianaTigerfan
Will be livestock and orchards. Will not be a main source of income, and already have the financing in place.
Just curious about what's the best way to set it up as a registered business so I can write off the expenses
Just curious about what's the best way to set it up as a registered business so I can write off the expenses
Posted on 2/17/17 at 7:48 pm to FelicianaTigerfan
Google "hobby loss rules" before you spend a bunch of money expecting a large tax deductions. It doesn't matter how you structure it if it's not your primary income and you don't show a profit 3 out of 5 years.
Posted on 2/17/17 at 8:53 pm to tigeryat
Is there a straight answer for my question?
I understand the "hobby loss rules" and such. I've been doing it for a while now and just paying out of personal accounts and not claiming any expenses. I don't write off fuel, or any maintenance cost and if I can just get a little break on that it would be an improvement.
I've had people tell me to stay away from doing a LLC and others say it's the way to go.
I understand the "hobby loss rules" and such. I've been doing it for a while now and just paying out of personal accounts and not claiming any expenses. I don't write off fuel, or any maintenance cost and if I can just get a little break on that it would be an improvement.
I've had people tell me to stay away from doing a LLC and others say it's the way to go.
Posted on 2/17/17 at 9:11 pm to FelicianaTigerfan
I would start with chickens.
Posted on 2/17/17 at 9:35 pm to Decisions
quote:
It doesn't take long to run through a million in farming. Our seed and fertilizer expenses alone this year were about half a million, and we're not close to the biggest operation in our area.
This is amazing to me.
How much money can you make from selling what you grow?
Posted on 2/17/17 at 9:48 pm to FelicianaTigerfan
quote:
Is there a straight answer for my question?
It's a simple question, but there can be multiple correct answers. I'd talk to an accountant or lawyer (or both) if I were you. Bonus points if they specialize in tax.
quote:
How much money can you make from selling what you grow?
Not as much right now as a few years ago. Corn price is practically below cost of production ATM. Cotton and soybeans are looking up, on the other hand. If you're smart and run a lean operation the potential is there for a good living.
This post was edited on 2/17/17 at 9:53 pm
Posted on 2/17/17 at 9:56 pm to Decisions
Will be going to my CPA soon and plan to discuss it with him but to be honest, he is a dick. Not very helpful at all and just wants his 175 dollars to plug my shite in to the computer for taxes and doesn't really offer much advice on stuff. I'll be going to a new one as soon as I find one reliable.
Posted on 2/17/17 at 10:04 pm to FelicianaTigerfan
You need a tax attorney.
Posted on 2/17/17 at 10:06 pm to Decisions
quote:
Not as much right now as a few years ago. Corn price is practically below cost of production ATM. Cotton and soybeans are looking up, on the other hand. If you're smart and run a lean operation the potential is there for a good living.
How many acres of each do you have under cultivation now...last year?
This post was edited on 2/17/17 at 10:07 pm
Posted on 2/18/17 at 12:22 am to LSU Tiger Bob
About a thousand acres each of corn and cotton. We're probably the only people in our area still growing cotton and not growing any beans, but hey we like it and are very good at it.
Posted on 2/18/17 at 12:33 am to FelicianaTigerfan
quote:
I really have no idea how to do this or what needs to be done.
So, instead of writing a business plan and consulting with professionals, you come to an internet message board?
The best way to start a small business is to start a big one and wait. Do you at least know the basics of the type of farming you intend to do?
quote:
LLC, Partnership/Co-op, LLp, etc?
This is all going to depend on a huge range of factors. It is hard to go wrong with an LLC - because you have partnership (or sole proprietor) rules of management, but limited liability of a corporation. You can also elect flow through taxation, which I assume you're going to want.
Posted on 2/18/17 at 6:25 am to StringedInstruments
Farming nowadays is big business or huge business, no little guys left. Go to the LA/ARK/MS delta areas and 2000 acres is about a medium to small size operation.
For the OP
So see a tax attorney or CPA who specializes in AG businesses and taxes, they are out there just have to find them. Talk to farmers and ranchers to run down some names. If you wouldn't mind keeping this updated I would appreciate it, I plan on doing the same exact thing in the next year or two.
For the OP
So see a tax attorney or CPA who specializes in AG businesses and taxes, they are out there just have to find them. Talk to farmers and ranchers to run down some names. If you wouldn't mind keeping this updated I would appreciate it, I plan on doing the same exact thing in the next year or two.
Posted on 2/18/17 at 7:01 am to FelicianaTigerfan
Moved to Oregon or Washington and grow weed.
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