Legacy nutrient deductions

[Howboutthemdawgs]

Ever heard of this? Received a packet in the mail today. This stuff is so above my pay grade but I do enjoy saving money

 

[T-Max]

Government incentivizing poor management now?! Sounds about par for the course…


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[T-Max]

I kid, but I heard on another forum that you could claim depreciation on your soils themselves. I wonder if that is what this is?


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[Howboutthemdawgs]

My soils suck so I’m guaranteed top dollar.

 

[Turkish]

If it’s what I think it is, it lets you write off fertility loss. So if your fertility was poor when you bought, it’s not much help.

The Land podcast is sponsored by a similar group.

 

[Howboutthemdawgs]

If it’s what I think it is, it lets you write off fertility loss. So if your fertility was poor when you bought, it’s not much help.

The Land podcast is sponsored by a similar group.

I wonder how they know? I would assume it wasn’t world class Iowa soil but it’s definitely gotten worse just by virtue of erosion over the last four years

 

[Turkish]

I wonder how they know? I would assume it wasn’t world class Iowa soil but it’s definitely gotten worse just by virtue of erosion over the last four years

I think you have to have certified testing/documentation done when you acquire the property. It sounds to me a little like a timber basis.

 

[hillrunner]

I did this last year on a couple new pieces. I had the coop do grid sampling and write up a report listing the excess soil fertility present in the soil. My accountant handled it from there. It's a hefty deduction.
some guys in Iowa are writing off $2,000 an acre on high quality ground.
it's a section 180 deduction.

 

[westonwhitetail]

Why don't they have a program that rewards improving the soil? Your organic matter increased from 2 - 4%, nice management, here's your check. Is this just giving farmers a discount on land without incentivizing/requiring good management practices?

 

[Turkish]

Why don't they have a program that rewards improving the soil? Your organic matter increased from 2 - 4%, nice management, here's your check. Is this just giving farmers a discount on land without incentivizing/requiring good management practices?

This is a tax code thing, not a USDA or conservation program. Technically, there’s an inherent benefit to the owner from fertility increases from the objective increase in property values that come with it. This is a write off of an “expense” associated with production. It’s not anything that’s applicable to me, but the logic of it makes sense, I suppose.