We recently had the opportunity to sit down with Roger McEowen, professor of agricultural law and taxation at Washburn University. Professor McEowen discussed his upcoming ag law talk. Here is what he had to say.
“I’ll be in Guntersville, Alabama, Wednesday morning, the 19th of August, talking about residual soil fertility. This is a two-hour seminar for firms that do the soil analysis in CPAs. This is the hot issue,” McEowen explained.
“This is the wild, wild west of tax because we don’t have any rules on deducting residual soil fertility. The IRS blessed the concept over 30 years ago and said, when you buy a farm or inherit a farm, if you can get an agronomic study done that shows the level of fertility in the soil, determines a baseline, and you can show that you have an excess fertility above a baseline in that area, then you can claim a deduction for that additional fertility. It’s got a lot of twists and turns to it,” added McEowen.
McEowen also said, “There’s some uncertainties, a lot of uncertainties to it because we just don’t have any technical guides from the IRS as to how to actually compute the amount of the fertility, where to take it on the return, and whether I could go back if I’m just learning about the concept now and I bought a farm 5, 10, 15 years ago, can I go back and claim a deduction for that residual fertility now? So, that’s known as hindcasting. So, that’s what I’m going to be talking about.”
This event will be held at the Event Center in Guntersville City Harbor.
Audio Reporting by Elizabeth Sanders for Southeast AgNet.