Discussion:Farm accounting methods
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| 15 December 2005 | |
| My client (sole proprietor) raises veal calves. They are raised in batches, normally 18 weeks per batch. So some years there are two batches and some years three. Frequently he has all the expenses of raising a batch in one year, and the sale income the beginning of the next. On the cash basis, this is difficult to deal with. Sometimes he can buy feed ahead to try to keep the profit levels consistent from year to year. Now this year (2005), he will break even or possibly show a net loss, and in 2006, he projects a net profit in six figures. That will be pretty difficult to balance out with pre-bought feed. Income averaging may help, but even that is of limited value when the three prior years have widely varying taxable incomes.
He is asking if he can change to the accrual method of accounting. He thinks then each year he could match his expenses to his income, and pay tax on the profit he made on the batches he sold during that year. What advice would you give him if he were your client, about changing accounting methods, or anything else that might help in a situation like his? Does anyone have experience with changing accounting methods? Or experience with farmers using the accrual method? | |
Shahid1416 (talk|edits) said: | 28 September 2008 |
| Dear sir please write me how i transfer my partner share in my account | |
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