
October 2017
Iowa Fence Law in Action
A recent case from the Iowa Court of Appeals 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.The parties were adjacent landowners.
A 600-foot partition fence separated their properties. The defendant raised cattle and had always maintained the west 300-feet of the fence. When the defendant’s cattle escaped through the east half of the fence, the defendant sent multiple written requests to the plaintiff, asking him to maintain the east 300-feet of the fence. The plaintiff refused, stating “that’s not what the law requires” and that he already had “too many projects.”
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The Syngenta Settlement with Farmers: What Does it Mean?
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.
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Iowa's Animal Production Facility Fraud Statute Challenged
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. But since the law’s passage, opponents have vowed to challenge its constitutionality on First Amendment grounds. That challenge was brought on October 10, 2017, with a lawsuit filed in the United States District Court for the Southern District of Iowa against the Governor and Attorney General of Iowa.*
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Health Insurance: What’s an Iowa Farmer (or Sole Proprietor) to Do?
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." With that proposal off the table, these facts remain.
- Medica is the only insurer writing policies in the Iowa ACA-compliant individual market for 2018. Medica filed a rate request seeking a 56.7% premium increase for its 2018 Iowa plans in August. Proposed plans become final November 1, but potential subscribers can preview sample Medica rates for different Iowa regions here.
- In the past several weeks, thousands of Iowans currently insured on the individual market, including many farmers, received notification that their policies would not be renewed for 2018.
- The Healthcare Marketplace Exchange enrollment period for 2018 begins November 1, 2017, and will remain open for 45 days.
- Iowans with incomes at or below 400% of the Federal Poverty Level (FPL) will generally be eligible for premium tax credits to assist with the cost of high premiums.
- Iowans with incomes above 400% of the FPL will not be eligible for subsidies and will be responsible to pay the entire premium themselves.
- In 2017, 162,000 Iowans are insured in the individual market. Around 80,000 people in this segment are enrolled in plans that were purchased prior to the ACA. The balance purchased ACA-compliant policies. Approximately 50,000 of those were purchase on the Exchange.
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President Trump Signs Family Farmer Bankruptcy Clarification Act into Law
On October 24, 2017, The Family Farmer Bankruptcy Clarification Act of 2017, received final Congressional approval and was sent to the President for his signature. He signed it into law on October 26, 2017. This provision was part of a larger bill, the H.R.2266 - Additional Supplemental Appropriations for Disaster Relief Requirements Act, 2017, including the Bankruptcy Judgeship Act of 2017. The Bankruptcy Judgeship Act allows for the appointment of new bankruptcy judges in certain regions and modifies some fee provisions. Senators Grassley and Franken also included in this Act, Section 1005, titled “Clarification of rule allowing discharge to governmental claims arising from the disposition of farm assets under chapter 12 bankruptcies.” This provision, also called the Family Farmer Bankruptcy Clarification Act of 2017, is intended to assist struggling farmers by providing them with more options for reorganization through a Chapter 12 bankruptcy.
Section 1005 reverses Hall v. U.S., 132 S. Ct. 1882 (2012), a 5-4 decision which interpreted current law to make it nearly impossible for farmers to discharge in a Chapter 12 bankruptcy capital gains tax arising due to the sale of property after the filing of a bankruptcy petition. Rather, Hall declared that taxes incurred due to the sale of farm assets used in the debtor’s farming operation could be treated as unsecured claims only if the sale occurred in the tax year prior to the filing of the bankruptcy petition. This meant that many farmers could not reorganize their operation by selling assets to “right-size” the business after the bankruptcy action began. And liquidating assets before the filing was often unworkable.
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Minister's Housing Allowance Again Declared Unconstitutional
The minister’s housing allowance provided by IRC § 107(2) has again been declared unconstitutional by the United States District Court for the Western District of Wisconsin. And this time it is likely that the United States Court of Appeals for the Seventh Circuit will rule on the merits of the challenge to this provision, rather than dismiss the case for lack of standing. The case is Gaylor v. Mnuchin, No. 16-cv-215-bbc (W.D. Wisc. Oct. 6, 2017).
The case is the second bite at the apple for the Freedom from Religion Foundation (Foundation), which argues that the parsonage allowance is an unconstitutional establishment of religion in violation of U.S. Const. amend. I. In 2013, the same district judge, Barbara Crabb, ruled in favor of the plaintiffs and declared § 107(2) unconstitutional because it benefitted “religious persons and no one else. The Seventh Circuit, however, vacated the decision on the ground that the plaintiffs did not have standing to sue. In the first case, the plaintiffs had not been denied a claimed exemption. They stated on their return that they were “not clergy” and that their “employer is not a church,” but that they believed “it is unfair that ministers can exclude housing while we cannot.” This time, IRS disallowed their claim, with the final IRS response coming two months after the plaintiffs filed this second lawsuit.
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Facts
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Tax Schools Are Ready to Begin...Register Today!
We are beginning our 44th Annual Federal Income Tax Schools this week! We have a great slate of locations and speakers, and we're looking forward to seeing you around the state! Reserve your spot today.
November 2-3, 2017 – Maquoketa, Iowa – Centerstone Inn and Suites
November 6-7, 2017 – Le Mars, Iowa – Le Mars Convention Center
November 8-9, 2017 – Atlantic, Iowa – Cass County Community Center
November 9-10, 2017 – Mason City, Iowa – North Iowa Area Community College
November 16-17, 2017 – Ottumwa, Iowa – Indian Hills Community College
November 20-21, 2017 – Waterloo, Iowa – Hawkeye Community College
December 11-12, 2017 – Ames, Iowa and Live Webinar – Quality Inn and Suites
e-Services Applications Operational Again
IRS announced on October 30 that most user applications for e-File, Transcript Delivery Systems and the AIR Transmitter Control Code are now available. The transition of e-Services to a new platform was completed over the weekend. All users except for state users may now submit new or change existing applications. The agency also announced that the move of e-Services to a new identity proofing process called Secure Access currently is on hold while it reviews vendor options.
New on TaxPlace in October
October 26, 2017 Webinar Replay - Farm Income
October 24, 2017 Webinar Replay - Farm Expenses
October 19, 2017 Webinar Replay - Partnership Audit Issues
October 18, 2017 The Scoop - October 18, 2017
October 17, 2017 Webinar Replay - Tax Update
October 17, 2017 Update: Proposed Valuation Discount Regulations Withdrawn
October 17, 2017 Applicable Federal Rates (AFRs): November 2017
October 11, 2017 Webinar Replay - Part 2 - Retirement Planning and Social Security
October 10, 2017 Webinar Replay - Part 1 - Retirement Planning and Social Security
October 4, 2017 The Scoop - October 4, 2017
The Center for Agricultural Law and Taxation does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. The Center's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.