Section 179 and Beginning Farmer Legislation Pending in Iowa Legislature
SF 220, a bill to give S corporations and C corporations a $70,000 2018 Section 179 deduction like other taxpayers has passed the Senate and is waiting for a vote in the House. HSB 173, a bill to enhance funding to the Beginning Farmer Tax Credit Program has passed out of the House Committee on Agriculture and is waiting to come before the House. For more information, click here.
Iowa Appeals Ag Fraud Statute Ruling
On February 20, 2019, the State of Iowa defendants Governor Reynolds, Attorney General Tom Miller, and Montgomery County Attorney Drew Swanson filed a notice of appeal in Animal Legal Defense Fund v. Reynolds, No.4:17-cv-00362 (S.D. Iowa 2018), the district court decision that declared Iowa's Agricultural Production Facility Fraud statute unconstitutional. The opening brief is due April 3, 2019. Read this post for more information.
New on TaxPlace
We offer a number of TaxPlace resources to subscribers and non-subscribers alike. Here are a few updates from February:
February 18 Applicable Federal Rates (AFRs): March 2019
February 13 Common Control and Aggregation
IRS Extends March 1 Filing Deadline for Farmers
At the last hour, IRS announced in Notice 2019-17 an extension to the March 1 deadline for farmers who did not make estimated tax payments by January 15, 2019. Under this Notice, farmers have until April 15 (April 17 in Maine or Massachusetts) to file their 2018 returns and pay in full any tax due. The Notice waives the IRC section 6654 penalty for failure to make estimated tax payments for these farmers and fishermen, but the relief must be requested. Continue reading here.
Iowa Department of Revenue Follows Suit
IDOR also announced on February 28, 2019 that it too would grant an extension to the March 1 deadline for farmers and fishermen who did not make estimated tax payments by January 15, 2019. These farmers will have until April 30 to file their Iowa returns and pay their income taxes without incurring estimated tax penalties. Read more here.
U.S. Supreme Court Agrees to Hear Key Clean Water Act Case
On February 19, 2019, the United States Supreme Court granted certiorari in a Clean Water Act (CWA) case with far-reaching implications for many industries, including agriculture. The case is Hawai‘i Wildlife Fund v. Cnty. of Maui, 886 F.3d 737 (9th Cir. 2018). The question the Court agreed to answer is: Does the CWA require a permit when pollutants originate from a point source but are conveyed to navigable waters by a nonpoint source, such as groundwater?
In County of Maui, the Ninth Circuit ruled that the county had violated the CWA by discharging pollutants from a point source into navigable waters without an NPDES permit. What makes the case unique is that the point sources at issue—wastewater injection wells—did not discharge the pollutants directly into the navigable water, the Pacific Ocean. Rather, the county injected the pollutant (treated wastewater called effluent) into groundwater, which carried the effluent from the point source to the navigable water. The Ninth Circuit ruled that because the indirect discharges were “fairly traceable” from the injection wells to the Ocean, an NPDES permit was required. Continue reading here.
March 1 Triggers Important Farm Lease Questions
My tenant and I signed a written lease for the 2019 crop year. The lease provides that the rent is due, up front, on March 1. It’s March 6 and my tenant hasn’t paid. I am afraid that he does not have the money. What can I do?
First, it is important to note that requiring rent up front is a good idea for landlords wishing to minimize disputes and problems associated with a tenant’s nonpayment of rent. Nonetheless, this protective approach does not always guarantee smooth sailing. Sometimes, a landlord will be forced to confront a nonpayment situation early on in the lease term. Continue reading this answer here.
I leased a parcel of farmground during the 2018 crop year. I was unable, however, to complete my harvest because of unexpected weather conditions. I still have corn in the ground, but my lease terminates March 1, 2019. What can I do?
Given the crazy weather of 2018-19, this is a common question we've been fielding. Read this answer here.
Donate to CALT
As you know, our work at the Center is dependent on the fees generated by seminar registrations and gifts. If you would like to donate to further the Center's efforts, please contact our Program Administrator, Micki Nelson at email@example.com or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
Donate to CALT
As you know, our work at the Center is dependent on the fees generated by seminar registrations and gifts. If you would like to donate to further the Center's efforts, please contact our Program Administrator, Tiffany Kayser at firstname.lastname@example.org or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
It Was Probably Too Good to Be True
In late breaking news, the U.S. Court of Appeals for the District of Columbia reversed the district court and ruled that IRS does have the authority to charge tax return preparers a fee for obtaining and renewing a PTIN.Montrois v. United States, No. 17-5204 (D.C. Cir. March 1, 2019).
So much for the refund!
IRS Provides Safe Harbor for Passenger Auto Depreciation
On February 13, 2019, IRS issued Rev. Proc. 2019-13, a safe harbor addressing an "anomalous" issue arising when taxpayers apply the new 100 percent bonus depreciation provisions to passenger vehicles.
For more information, read this post.
Tax Extenders Still a Possibility
On February 28, Senators Grassley and Wyden introduced the "Tax Extender and Disaster Relief Act of 2019," which would revive or extend a number of expired or expiring tax breaks. We will be following this proposed legislation and keep you posted.
For more information, including a link to the bill and a link to expired and expiring provisions, read this post.
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.