May 8th 2012

Tax Management Strategies for Farmers — 2nd Edition

From the May 7, 2012 Issue of Agri-News

The second edition of the Tax Management Strategies for Farmers book is now available. the first edition was first published 15 years ago, and this edition updates information based on new rules and regulations in the Income Tax Act.

“Over the last 10 years, there have been a lot of tax changes that effect farmers,” says Merle Good, business development specialist – tax strategies, with Alberta Agriculture and Rural Development. “One of these changes is the increase in the capital gains exemption from the former $500,000 to the current $750,000 exemption amount. A major change noted in the new edition concerns the purchasing and operating of lease agreements with machinery.”

New rules regarding the use of partnership in corporations are included in the new edition. As well, some of the new rules that have received a lot of interest lately concern the reporting of surface lease income from oil and gas operations.

The new edition goes over several areas in a concise format that is easy to use. It also includes a checklist of issues for producers when preparing their tax return.

“The book isn’t limited to only day-to-day income tax rules, which it does include in the first three chapters, but also farm property issues such as capital gains exception, roll-over of farm property to the next generation and business organizations,” says Good. “Partnerships, which I feel are very underused by producers who don’t want to be corporate farms, are considered and explained.

“The book also discusses corporations and the rules that apply to the renting of property versus actively farming. So, not only the income tax rules, but rules governing the transferring of assets are included in the new edition of the tax management book.”

The new edition of Tax Management Strategies for Farmers can be ordered online by visiting Alberta Agricuture’s Website  or by calling the Ag-Info Centre at 310-FARM(3276). Copies are available at the VBDS office (110 – 1 Ave. S. Vulcan) to borrow.