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 Worst.Housekeeper.EVER.
   
Location: Missouri | Thanks for the words of caution, Jenbabe. I felt like you were being helpful :) | |
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 The Comeback Kid
Posts: 1564
Location: lost in missouri | I do not feel you are trying to be fishy, but just wanted to warn you of the IRS issues with equine/farms. I taught in an equine program and this is one subject we drilled and drilled and drilled on. We have some friends that are now homeless due to them trying to use their hobby as a business writeoff. Everyone needs to do what they can to keep their money in their pocket but one has to be safe in their practices when writing off equine/farm gains and losses. My family background is a family run business and farming. there is a lot of paperwork to keeping your a$$ out of trouble if you ever get in an audit. | |
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I Need a Xanax!
Posts: 2774
| I don't have any advice but I'm learning from this thread so carry on yall.  We grow hay and have a few cows so we claim farm on our taxes but I do not include anything to do with the horses on my taxes. Great thread topic... | |
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Elite Veteran
Posts: 962
| Just Bring It - 2014-06-05 3:30 PM
just4fun - 2014-06-05 3:01 PM Seems like some have misunderstood my intent. I am not attempting to commit fraud, nor asking anyone to help me figure out how to file a questionable return.
I was simply asking how to make my situation profitable. It can be done, I think it's a matter of paperwork, like the previous poster suggested. We have set things up the way the are out of convenience. It also saved us considerable money to not have to buy horse hay and not have to maintain pasture we weren't using. However, since we will soon be living there, it makes sense that we could use the land to our own advantage.
Thanks for those who offered constructive advice.
Also, we own a business so I understand a little about the system and the accountant's perspective. I also understand that we aren't paying him to work out our personal finances. I was not trying to be condescending towards him. He does well with what he is paid to do.
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Yeah paperwork and getting money coming in. You don't have to be "profitable" but you do need to have money coming in and have it set up as a business. So even if you charge land rent and turn around and spend that money on spray, etc. Those expenses can also be deducted. Most likely you are just a hobby but if you can find a way to make it into a business then more power to you.Â
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The Resident Destroyer of Liberal Logic
Location: PNW | My first thought on reading your original post is: you don't run a BUSINESS. You have a hobby that occasionally brings in some extra money.
I'm not trying to be rude or harsh, but farming and ranching isn't the field to "let's just figure this out with trial and error". And even then, on a small scale - it is hard to make enough to turn a profit AND support your family.
My husband and I run about 100 cow/calf pairs every year, a good number of feeders, and then we also have several hundred sheep that we sell the lambs for meat every year. Animals have to be worked, wormed, castrated, vaccinated, shorn, tailed, etc. you need facilities for this. Facilities can be expensive. We just totally rebuilt our corral/working systems and I honestly don't want to know the exact total of what it cost. Vaccines, labor, and supplies are all also expensive.
If your pastures aren't enough to put weight on your animals (depends what you are growing and how well you are growing it), you will need to feed them AT LEAST once a day. And that means hay - which is another expense. And diesel for your truck or tractor to get that hay to them.
There's a lot more to it than just dropping animals in a field and calling it good. And since you've already stated that you don't know about raising animals other than horses..... That doesn't bode well - for you or your livestock.
Also, YOUR TIME is worth something. So factor that in. You don't get sick days, vacation days, or holidays off. Once you decide to ranch, that's it. You might be in the barns first thing on Christmas morning feeding early-born bummers, or out last thing on your birthday helping pull a calf.
If I were you, I'd enjoy the little bit of extra income that your land provides, ask to be paid in cash, and don't quit your day job.
Edited by svincent 2014-06-06 12:06 PM
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The Resident Destroyer of Liberal Logic
Location: PNW | As for the horses, I would be VERY careful trying to claim them.
We claim our feed/vet/care expenses because all of my barrel horses also double duty as ranch horses. But I definitely wouldn't claim fuel to races, training, fees, etc. those have NOTHING to do with ranching and you can bet the IRS would call you on it. | |
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