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The Tax Cuts and Jobs Act contains a number of provisions that apparently do not accord with legislative intent. This is, in some cases, evidenced through discrepancies between the committee report and the language in the code. Today, we will highlight two apparent errors with significant impact to many taxpayers.

Note: The Iowa Department of Revenue has launched a new webpage, where it will be publishing its latest guidance and information on the new Iowa law.

May 24, 2018 | Kristine A. Tidgren

Generally, the uniform capitalization rules (UNICAP) have required all farmers, regardless of size, to capitalize pre-productive costs of plants that have a pre-productive period of more than 2 years. IRC§ 263A(a)(1), (d)(1)(A)(ii).

cows in a field

Stray voltage causing damages to dairy farms is a problem that has been facing the dairy industry for year with damages cases dating back to 1984. Stray voltage is caused when a power line’s neutral line is “leaking” electrical currents into the ground. A common cause of stray voltage is a neutral wire that is either too small or damaged and allows the current to go into the ground. 

On April 12, 2018, the United States Court of Appeals for the Fourth Circuit vacated a district court’s judgment and held that a discharge that passed from a point source through groundwater to navigable waters could support a Clean Water Act (CWA) claim. The Fourth Circuit in Upstate Forever v.

April 25, 2018 | Kristine A. Tidgren

An entirely renovated Iowa partition law will go into effect on July 1, 2018. On April 11, 2018, Governor Reynolds signed SF 2175 into law.

Judge Lungstrum granted preliminary approval for the $1.51 billion Syngenta settlement on April 10, 2018.

grassy field

The Tax Cuts and Jobs Act (TCJA) ushered in the most significant changes to our tax code in more than 30 years. On December 22, 2017, President Trump signed the TCJA into law. Although most changes went into effect January 1, 2018, meaning that they will impact tax returns filed in 2019, most agricultural clients need to understand how the law is impacting them in 2018 so they can make good business decisions in the months ahead. Although many decisions will hinge on IRS guidance that has not yet been issued, much about the law can be understood.

On April 2, 2018, Governor Reynolds signed SF 2349, into law. The new law is designed to address the mounting difficulties faced by many Iowans seeking to purchase health insurance on the individual market.

Update: On May 2, the D.C. Circuit Court of Appeals issued the mandate vacating the 2008 final rule.

March 22, 2018 | Kristine A. Tidgren

President Trump signed the Consolidated Appropriations Act, 2018, H.R. 1625, on March 23, 2018.

Yesterday, plaintiffs filed a motion asking for preliminary approval of a settlement reached with Syngenta.  The proposed settlement, which would comprise $1.51 billion, is described by plaintiffs’ counsel in a court filing as a “record-breaking achieve

Last fall, we wrote about the health care crisis facing many Iowa farmers and other small business owners. Many of those with incomes above 400 percent of the federal poverty limit faced 2018 health care insurance premiums surpassing $30,000 per year on the individual market.

February 28, 2018 | Kristine A. Tidgren

The Tax Cuts and Jobs Act has significantly changed the tax landscape for agricultural producers. We’ve detailed a number of the changes, many of them positive, in prior articles. In light of the federal changes, Iowa must now decide how to respond.

The Tax Cuts and Jobs Act (TCJA) made significant changes impacting the depreciation and expensing of vehicles used in a trade or business.[i] In this post, we review the current law.

The Iowa Court of Appeals recently found that Fayette County improperly granted permits to a wind energy group to build three wind turbines on agricultural land. This opinion leaves in effect a district court order that directed the group to remove the turbines.

A case that has again found it's way to the Iowa Court of Appeals could give the Iowa Supreme Court another opporunity to refine the doctrine of promissory estoppel.

On February 12, 2018, the Iowa Supreme Court heard oral arguments in a case that will shape Iowa nuisance law, as it applies to animal feeding operations.

President Trump signed the Bipartisan Budget Act of 2018 into law on February 9. The Act, which was passed to fund the federal government and avoid another shutdown, includes a number of changes to the Internal Revenue Code.

Update: Governor Reynolds signed SF 512 into law on January 31, 2018.

January 16, 2018 | Kristine A. Tidgren

The Tax Cuts and Jobs Act preserved like-kind exchange treatment for real property, but eliminated it for personal property. Today, we take an initial look at what that means for farmers or other taxpayers looking to trade equipment or livestock in 2018. We will soon write separately about vehicle depreciation and trades in light of the new law.

January 12, 2018 | Kristine A. Tidgren

Iowa law has been clear, and it is perhaps even more clear today. Unlike most other states, Iowa is “unequivocal in favoring partition by sale." Newhall v. Roll, 888 N.W.2d 636, 640 (Iowa 2016).

Update: On March 13, 2018, Senators Grassley, Hatch, Roberts, Thune, and Hoeven issued a joint statement, including the following:

December 29, 2017 | Kristine A. Tidgren

As the year concludes, we’re taking some time to review the most significant happenings in agricultural law and taxation in 2017. Some closed chapters on drawn-out litigation or administrative action. Others signal the beginning of much more activity to come. In any event, 2017 did not disappoint in terms of lots to discuss. We review these highlights below, in no particular order.

On April 11, 2017, the United States Court of Appeals for the District of Columbia vacated an EPA final rule that had been in place for nine years.

December 21, 2017 | Kristine A. Tidgren

We told you last April about changes that would come to the Iowa Beginning Farmer Tax Credit program in 2018, absent legislation. Because those legislative changes did not occur, cuts to the program are now being felt by beginning farmers and landlords around Iowa.

December 20, 2017 | Kristine A. Tidgren

Update: President Trump signed H.R.1 into law on December 22, 2017.

December 7, 2017 | Kristine A. Tidgren

The Iowa Court of Appeals recently affirmed a judgment in favor of a borrower, against his banker, for claims of fraudulent misrepresentation and nondisclosure.

December 2, 2017 | Kristine A. Tidgren

Update: The conference committee released its report on December 15, 2017. Congress will vote on this final bill next week. Read our summary of the final bill here.

On October 31, the IRS issued Notice 2017-67, detailing requirements for the qualified small employer health reimbursement arrangements (QSEHRAs) implemented last December by the 21st Century Cure

November 21, 2017 | Kristine A. Tidgren

Update: The House of Representatives passed H.R. 1 on November 16 by a vote of 227-205. Later that day, the Chairman's Mark cleared the Senate Finance Committee by a vote of 14-12. The Senate legislative text has been released here.

Note: These provisions have been significantly modified by the Chairman's second amendment. In particular, the SE tax modifications have all been removed in the Bill that passed out of the Committee. A lower bottom threshold rate was also added for small pass-through businesses.

Many farmers and other self-employed Iowans not eligible for Medicare or Medicaid have few choices when it comes to 2018 health insurance. Last week, due to a lack of federal response, Iowa officials withdrew their proposed Stopgap proposal. They submitted the waiver application in an attempt to prop up Iowa’s individual insurance market in the face of skyrocketing premiums. It was hoped that the measure would stabilize the individual market through "innovative solutions."

October 25, 2017 | Kristine A. Tidgren

A case from the Iowa Court of Appeals today illustrates the operation of the Iowa fence law. If they receive a written request from their neighbor, adjoining landowners are required to contribute half of the cost to maintain a partition fence, even when they don’t want to. A resistant landowner found that out the hard way.

Update: On October 26, 2017, President Trump signed this bill into law.

October 18, 2017 | Kristine A. Tidgren

It was not unexpected. In 2012, the Iowa Legislature passed and Governor Branstad signed Iowa Code § 717A.3A. This legislation, titled Agricultural Production Facility Fraud, has been called Iowa’s “Ag-Gag” law. It’s a law specifically protecting animal production facilities from unauthorized intrusion.

October 17, 2017 | Kristine A. Tidgren

Update: IRS formally withdrew these proposed regulations (REG 163113-02) in FR Doc. 2017-2776, filed October 17, 2017, for publication on October 20, 2017.

The following was orginally published on October 4, 2017:

Everyone interested in the farmer lawsuits against Syngenta knows about reports of a settlement between the disputing parties, achieved in the midst of a jury trial.  But the settling parties aren’t saying what the details of the settlement might be. Following is an effort to gather some available information and hypothesize therefrom what the settlement might mean for individual farmers.   

September 29, 2017 | Kristine A. Tidgren

First there was the Blueprint, then the Bullet Points, and now the “Framework.”

On September 27, the U.S. Tax Court ruled that a Texas farm couple was not liable to pay self-employment tax on rents they received from the S corporation through which they conducted a poultry growing operation. The decision in Martin v. Commissioner, 149 T.C. 12 (Sept.

September 26, 2017 | Kristine A. Tidgren

It was announced on September 26, 2017, that Syngenta agreed to settle claims brought against it by U.S. farmers on account of its allegely premature marketing of Viptera and Duracade GMO corn. These claims include those in the Syngenta MIR 162 Corn Litigation, as well as those in the class action in Minnesota state court.

September 14, 2017 | Kristine A. Tidgren

Update: On October 13, 2017, the EPA announced an agreement with Monsanto, BASF, and Dupont regarding measures to minimize damage from dicamba drift. Read the press release here.

The Iowa Court of Appeals recently affirmed a jury verdict awarding a plaintiff $70,100 after her neighbor built a trail encroaching upon her property. The damages included $50,000 for trespass and loss of lateral support and $20,100 in treble damages for the loss of trees. The jury found the neighbor 75 percent responsible for the damage and his contractor 25 percent responsible.

September 12, 2017 | Kristine A. Tidgren

A recent case out of the tax court ruled that IRS had the power to examine the estate tax return of a predeceased spouse for the purpose of lowering the DSUE (deceased spousal unused exclusion) claimed by the second-to-die spouse’s estate.

August 25, 2017 | Kristine A. Tidgren

IRS’ Office of Chief Counsel recently weighed in on an important question for small partnerships: Are they automatically exempted from the requirement of filing a Form 1065, U.S. Return of Partnership Income, because of Rev. Proc. 84-35, 1984-1 C.B. 509?

Simply put, the answer was, “No.”

Time is running out to avoid automatic renewal of a 2017 farm lease in Iowa. Whether you’re a landlord or a tenant, Iowa law requires that you formally notify the other party by September 1 if you don’t wish to continue the current lease under its existing terms for another year.

Update: On October 23, 2017, Iowa withdrew its proposal for a stopgap measure.

August 21, 2017 | Kristine A. Tidgren

The Iowa Court of Appeals recently affirmed a Winterset couple's right to ownership of an asphalt driveway and two carports through adverse possession. The case presents a good overview of this powerful, yet sometimes-forgotten legal doctrine.

During a financial downturn, even secured creditors often find themselves with no real recourse. Junior lienholders, in particular, are often left in the cold, even when It seems there is enough collateral to go around.

A recent bankruptcy case illustrates this fact.

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