Purdue News
Purdue News
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October 22, 1999 Program to help farmers through taxing timesSources: George Patrick, (765) 494-4241,george.f.patrick.1@purdue.edu David Frette, (812) 254-3442
WEST LAFAYETTE, Ind. – As Indiana corn and soybean farmers assess their tax liabilities for 1999, they may feel a sense of deja vu. But a Purdue University tax expert and a private accountant caution farmers against assuming that a second consecutive year of low commodity prices will automatically mean low income taxes. "Tax planning in a year like 1999 is very important," said David Frette, a Washington, Ind., certified public accountant. "I like to sit down and review receipts and expenses with all of my clients in late November or early December while we can still take actions to influence their taxable income for 1999." Purdue Extension agricultural economist George Patrick agrees: "Most farmers use cash accounting, and their 1999 taxable income may be considerably different from what they expect. By planning, farmers may be able to avoid a loss for tax purposes if their 1999 income-for-taxes is brought down." Patrick and Frette will lead a closed-circuit discussion of year-end tax planning for Indiana farmers from 7 p.m. to 9 p.m. Wednesday, Nov. 17, at various Purdue Extension offices throughout the state. Frette said year-end tax planning is critical for farmers who need to make the best of a bad situation – or simply improve a good one. "For example, farmers who have normally prepaid some of their inputs may find taxable income will be higher than expected," Patrick said. "However, other farmers may find that their taxable income will be too low and they can increase income and reduce future taxes." During the program, Patrick and Frette will discuss in depth tax planning in difficult times, addressing earned income credit, how to make use of net operating losses, and the tax consequences of disposing of assets. They also will discuss the new rules on income averaging for farmers. "Many of the provisions of tax law interact, and these interactions make tax planning more complicated," Frette said. Patrick said that even those farmers who have a tax professional do their taxes every year can benefit from the free program. "You need to be aware of the tax management options and know when to ask questions," he said. The program, to be carried on the Indiana Higher Education Telecommunications System, will be available at several Indiana locations that are yet to be determined. Indiana farmers interested in attending should contact their county's Purdue Extension office or call 888-EXT-INFO. Writer: Amy H. Raley, (765) 494-6682, ahr@aes.purdue.edu Purdue News Service: (765) 494-2096; purduenews@purdue.edu
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