Wednesday, April 2, 2014

What Does The 2014 Farm Bill Mean For Your Dairy?

Nathan Shields, CPA, Jr Manager has been with the firm 6 years and spends a lot of time helping dairy clients understand accounting, taxes and the farm bill.

The 2014 farm bill was signed by President Obama on February 7, 2014. It is an expansive bill that is also known as the “jobs bill,” “innovation bill,” “research bill,” or “conservation bill.”

The two focuses of the bill are to help rural communities and provide food assistance to poor families and children. I am going to focus specifically on the impact the farm bill will have on dairies.

There is a new “Made in Rural America” initiative that will help rural businesses market their products globally. Along with the “Made in Rural America” branding, there will also be five regional forums on rural exports and an “investing in rural America” conference. It is expected that the USDA staff members in each state will be trained to help promote rural exports.

The Dairy Product Support Program (DPPSP) from the 2008 farm bill has been repealed but the permanent DPPSP from the 1949 Agricultural Act is still in effect. The Milk Income Loss Contract (MILC) has been replaced with the new Margin Protection Program for Dairy Producers. The Dairy Export Incentive Program (DEIP) is gone, effective immediately.

The farm bill moves more of the risk, and decisions to the farmer. The dairy section is no different. There are two new programs that will affect dairies. They are:

1. The Margin Protection Program for Dairy Producers (MPP). It is a voluntary program that depending on the level of protection purchased, pays out if a national benchmark for milk income over feed costs falls below the insured level.

2. The Dairy Product Donation Program (DPDP). This program requires the Secretary of Agriculture to immediately procure and distribute certain dairy products when the actual dairy production margin (ADPM) falls below the lowest margin level specified in the MPP.

The national benchmark for the MPP uses a hypothetical, but a nationally representative dairy herd. The calculation is calculated by using the national average price for all grades of milk less a factor of the cost of corn, soybean meal and alfalfa hay. The calculation is as follows:

National average of all classes of milk less 1.0278 x price of corn + 0.00735 x price of soybean meal + 0.0137 x the price of alfalfa hay. This is a calculation that is performed at a national level. It will not be calculated at a regional level. It is assumed that if the national average is “bad,” then each farm will be “bad” and qualify for the payment. They do not guarantee a specific dairy’s margin, but expect that each dairy will follow the national trend.

The cost for a $4.00 cwt income of feed cost (IOFC) is free. You may elect up to $8.00 cwt of coverage in $0.50 increments. The first 4 million pounds have a lower premium than the rest of the milk that you insure. There is also an additional 25% discount on the first 4 million pounds for producers who sign up in 2014 and 2015.

Tuesday, March 18, 2014

Weddings: A few tips to make your planning simple

Authored By: Lynette Wildman, Administrative Assistant in the Logan office

We wanted to share some additional tips that are not tax related but can be very helpful!!

There are many things to think about when planning a wedding. I’d like to share a few tips that may be helpful. Keep in mind that everyone’s circumstances are different. Ours was mixing American traditions with Tongan traditions.

Set the budget: I would suggest setting this first. Set it before you start so it doesn’t get out of control. Have the bride and groom choose the things that are most important to them so you know where to spend a little more money.

Pick the date: It was a trial finding a date that worked with everyone’s schedule. School, work, holidays, religious venue, reception venue, all of these things need to be taken into account. In the end, you have to choose the day that works best for you because you will never find a date that will accommodate everyone.

Find the venue: Find a facility that will cater to your needs. We needed a place that would let us bring in our own food, flowers, decorations, and that would accommodate a high volume of people. Most places require you to use the services they provide. If the bride and groom are from different locations you have to make the decision of having two celebrations or one, which then may result in two different venues. We chose to have one, due to the time of year (December 14th) and only living two hours apart from the grooms family.

The wedding dress: Start looking immediately. You have to take into account many different things. If you need a different size, it will take weeks to have it shipped in. Most dresses are sleeveless, so if you need to have alterations made, that will take a few more weeks. The cost for the material for the sleeves and the alterations are extras (each one will be different but ours was about $400). Have a picture of what you want the finished product to look like for the seamstress to reference so there are no surprises when you pick it up. Don’t forget the slips, veil, shoes, and the jewelry to complete your look. If you are doing bridal photos, you will need to have the dress dry cleaned before the wedding, which averages around $100. We had to take into account traditional Tongan attire that would be worn later in the evening and had an additional dress made to wear under the wedding mats.

Photography: Book your photographer as soon as possible, since you need to schedule a few dates with them: Your engagements, your bridals, and the wedding day. We chose to do bridals with the groom so we didn’t have to spend as much time on pictures on the wedding day in the middle of winter. Ask your friends about photographers they have used. It’s important to find someone with the right skills and personality for you. Look at their finished prints and find out about copyrights. Arrange for a bouquet for the bridals and a tuxedo rental for the groomals if going that route. Communicate with the photographer and everyone involved with the photos so that everyone knows the agenda and no one is left out. It is wise to let the photographer know of any special family circumstances so there are no awkward moments and let them know if there are any special photos you would like.

Invitations: Start collecting addresses. I suggest keeping a pen and paper with you at all times. You run into people and think, “I need to make sure I invite them,” and then two days later you won’t remember who it was. Include the postage when figuring the price of the invitations and stay with a standard size and thickness to avoid additional postage.

Decorations: Simple seems to be the way to go. It can still be classy.

Although it seems to consume your life and you are thinking about it every waking minute, it will be worth it when your daughter says, “This is the best day of my life”.