Peggy Kirk Hall, Asst. Professor, OSU Extension Agricultural & Resource Law
Spring planting season brings increased agricultural traffic on Ohio’s rural roads, including the use of All-Purpose Vehicles (APVs), All-Terrain Vehicles (ATVs), Gators, Mules and other four-wheeled utility vehicles. Laws on these vehicles have changed in recent years and there is still confusion over the new provisions. Farmers who plan to use an APV, ATV or utility vehicle on the roadway for farm work should take a few minutes to review the applicable laws and ensure compliance. Consider these provisions of Ohio law:
Licensing and registration. A license is not required for a ”utility vehicle,” which is a self-propelled vehicle with a bed designed for transporting materials, such as a Gator or Mule. A 2009 law required registration for APVs and ATVs, defined as ”self-propelled vehicl... Read More »
Fruit and Vegetable Producers Should Consider New Voluntary Approach to Food Safety Certification
Fruit and vegetable producers of all sizes now have the option of participating in a voluntary food safety certification program in Ohio. The Ohio Produce Marketing Agreement (OPMA) offers producers food safety standards and an opportunity to attain food safety certification through third party inspections. Born from growing concerns about fruit and vegetable contamination outbreaks, the OPMA takes an aggressive yet voluntary approach to addressing food safety risk.
The OPMA is the first “agricultural marketing agreement” developed under a new law in Ohio. The agricultural marketing agreement law allows agricultural commodities to create voluntary marketing programs to expand or improve the market for their commodity. Marketing programs may promote the sale and use of prod...
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OSU Extension is pleased to announce a series of farm management webinars to be held in the upcoming two months. These webinars are designed to deliver current educational information for farmers, landowners, and other interested participants. There is no pre-registration required for these webinars. Just log on from the comfort of your home or business! Attend all or any of the meetings by logging on to: http://carmenconnect.osu.edu/ohioagmanager. The following is a description of the upcoming webinars.
Financial & Tax Implications of Oil & Gas Leases - Wednesday, March 13, 2013, 7:00 p.m. – 9:00 p.m.
David Marrison, Associate Professor & OSU Extension Educator, will be the featured speaker for this webinar. Don’t get caught blindsided by the taxes which will be due from signing an oil & gas lease. Learn how the IRS handles oil & gas payments. Learn which payments are subject to ordinary income taxes v... Read More »
A written lease is a valuable tool to use in a farm lease situation, but many farm lease arrangements never progress beyond a conversation and a handshake. A written lease brings certainty to the farming arrangement by laying out important terms such as lease duration, notice of termination, payment provisions and conservation practices. Verbal farm leases are risky; problems can arise with legal enforceability and disputes over rights and obligations. For those dealing with a verbal lease agreement, here are a few strategies for protecting interests in the verbal farm lease situation.
Put the verbal lease in writing. The first recommendation is no surprise; attorneys have long encouraged farmers to use written farmland leases rather than relying on verbal agreements. But many landowners and tenants are uncomfortable using a written lease, for a variety of reasons. Consider the following concerns and recommendati...
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by Larry Gearhardt, OSU Income School Director
Some landowners in the oil and gas drilling area of Ohio may receive two real property tax bills for the same property. How can this happen? When the mineral interests are separated from the surface, the Ohio Revised Code (section 5713.04) requires the county auditor to list and value the land in separate entries, specifying the interest listed, and tax the parties owning the different interests. If the same person owns both the surface and the separated mineral interests, he may receive two property tax bills. This has surprised some landowners after the separation of the mineral interests.
WHY WOULD A LANDOWNER SEPARATE MINERAL INTERESTS BUT RETAIN OWNERSHIP?
Some landowners are taking the proactive step of separating the mineral interests from the surface for succession planning and tax management. It is not uncommon for a trust to be used. When we say that the landowner retains o... Read More »
Small farm owners who want to learn more about how to make their farms work better for them or expand their operations, or those new to agriculture who are looking for ways to utilize acreage, can attend workshops and presentations on these and more issues during a small farm conference March 23 in Zanesville, Ohio.
The "Living Your Small Farm Dream" conference and trade show is designed to help participants learn more tips, techniques and methods for diversifying their opportunities into successful new enterprises and new markets as a way to improve economic growth and development on their farms, said Mark Mechling, an Ohio State University Extension educator in agriculture and natural resources.
"It may be a person who is new to agriculture, or someone that may have acreage that they aren't using to the fullest, or even someone who has newly acquired land and may not know what to do with it," he said. "What we try to do with t... Read More »
Small farm owners who want to learn more about how to make their farms work better for them by increasing profits, increasing marketing efforts, expanding operations, or adding new educational or agritainment amenities can attend workshops and presentations on these and more issues during a small farm conference on March 8-9 in Wilmington, Ohio.
The "Opening Doors to Success" conference and trade show is designed to help producers learn more tips, techniques and methods and to increase their awareness to make their small farm operations more successful, which can lead to increased farm profits, said Tony Nye, an Ohio State University Extension educator.
"This intensive conference will provide participants the opportunity to choose from a diverse variety of seminars that can help their farming operations be successful," he said. "The conference is a great opportunity to network and learn from other producers, Extension experts an... Read More »
By Larry R. Gearhardt, Director of OSU Tax School
The depreciation deduction (usually MACRS method) for assets used in a trade or business has always been very important to farmers when preparing their income tax returns. In addition to MACRS, the “fiscal cliff” legislation, passed early in 2013, allows two additional cost recovery deductions in the year a depreciable asset is placed in service. Click here to view the IRS news release on the fiscal cliff changes to depreciation.
First, Code Section 179 allows the entire cost of qualifying assets to be deducted in the year they are placed in service, subject to some dollar and income limitations. Second, Code section 168(k) allows 50% of the cost of qualifying property to be deducted as additional first year depreciation (AFYD) for property placed in service in 2012 and 2013. Since MACRS depreciation, Section 179, and AFYD can all be applied to the same asset, whichever method ... Read More »
By Larry Gearhardt, Director of OSU Tax Schools and David Marrison, Extension Educator, ANR, Ashtabula and Trumbull Counties
Some landowners have already discovered that lease bonus and royalty dollars received for shale oil and gas lease payments over $150,000.00 per year are subject to the Ohio Commercial Activity Tax (CAT). See OSU Extension Fact Sheet at http://ohioline.osu.edu/sh-fact/pdf/SOGD_TAX2_12.pdf written by David Marrison, Extension Educator. However, some farmers may be surprised to find that they too are subject to the CAT tax because of higher gross receipts.
The Ohio CAT tax was passed in 2005 in response to a lagging economy. In exchange for the CAT tax, businesses are no longer required to pay personal property tax and individuals pay a lower Ohio income tax rate. Ohio’s income tax rate is currently approximately 20% lower than it was in 2004.
The CAT tax is an annual tax that is imposed on most businesses... Read More »
by: David Marrison, OSU Extension Educator
New and beginning farmers, returning veterans and disadvantaged producers may qualify for a new micro-loan program being offered by the USDA Farm Service Agency.
This program will offer applicants a micro-loan designed to help farmers with credit needs of $35,000 or less. Farms seeking a smaller loan for start-up or operational now have a new source of revenue. The loan features a streamlined application process built to fit the needs of new and smaller producers.
The new micro-loan program is aimed at bolstering the progress of producers through their start-up years by providing needed resources and helping to increase equity so that farmers may eventually graduate to more traditional commercial loans. Producers can apply for a maximum of $35,000. Microloans can be used for all approved operating expenses as authorized by the FSA Operating Loan Program, including but not limited to: I... Read More »
By Larry Gearhardt, Director OSU Income Tax Schools
A new option provides eligible taxpayers an easier way to calculate and claim the home office deduction. Currently, they are required to fill out a 43-line form (Form 8829) often with complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Taxpayers claiming this optional deduction will complete a significantly simplified form whereby they can claim a flat rate of $5 per square foot up to a maximum of 300 square feet.
The current restriction that the home office be used regularly and EXCLUSIVELY for business still applies (this means that the kitchen table does not qualify). However, if you have a designated area in your home that you use regularly and exclusively for business, you can take advantage of this safe harbor. Other restrictions are that you cannot depreciate the portion of your home used as a business, but using the new option doe... Read More »
Larry R. Gearhardt started on January 2, 2013 as the new Director of the Ohio State University Tax Schools. Larry was hired as a Field Specialist in Taxation in the College of Food, Agriculture and Environmental Sciences Extension. Before coming to Extension, he most recently was the Sr. Director of Legal and Local Affairs at the Ohio Farm Bureau. Larry received his juris doctorate from the University of Toledo College of Law and a BA in Business Administration from Wittenberg University in Springfield, Ohio. In 2011, Larry received the “Excellence in Agricultural Law” award from the American Agricultural Law Association. Larry lives in Miami County where he operates a 40-acre farm.
Contact information for Larry R. Gearhardt is:
Field Specialist: Taxation
34 Ag Admin Bldg.
2120 Fyffe Rd.
Columbus, Ohio 43210
by: Chris Zoller, Extension Educator, ANR
I recently saw an article by Stan Moore from Michigan State University Extension that addressed the topic of leadership on farms. This is a topic many farm managers struggle with, but is one of the critical functions that all farm managers must perform well. Below is the article Moore wrote for the Michigan State University Extension News.
What does it mean to be a leader? According to John Maxwell, “leadership is influence”. Being a leader means that your influence causes people to willingly follow you. Sometimes as farm owners/managers we forget how powerful the “willingly” part of following is. Sometimes we settle for just being the boss and that can mean that people follow you only because they are required to. Employees are still following you, but are they really being as productive as they can be, and how long will they be content in this kind of job?
As a Michigan Sta... Read More »
Informing landowners who are dealing with shale development is the goal of a day-long workshop offered in Mahoning County by OSU Extension. “Shale and You: A Workshop for Landowners” will take place on Saturday, February 23, 2013 at the Mill Creek MetroParks Farm, 7574 Columbiana-Canfield Road, Canfield, Ohio. OSU Extension’s Agricultural and Resource Law Program is sponsoring the workshop with grant assistance from the USDA’s North Central Risk Management Education Center and host support from OSU Extension Mahoning County.
Educators in OSU Extension’s Shale Education Program will provide an update on shale development in Ohio and address the topics of taxation of shale development income, wealth management, pipeline construction, oil and gas leasing issues and water testing. In addition to presentations on each topic, the team will also provide information displays and th...
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Ohio State University Extension embraces human diversity and is committed to ensuring that all research and related educational programs are available to clientele on a nondiscriminatory basis without regard to race, color, religion, sex, age, national origin, sexual orientation, gender identity or expression, disability, or veteran status. This statement is in accordance with United States Civil Rights Laws and the USDA.
Keith L. Smith, Ph.D., Associate Vice President for Agricultural Administration and Director, Ohio State University Extension TDD No. 800-589-8292 ( Ohio only) or 614-292-1868