Tax Seminar at Northwest Alpacas

On Sunday, March 16th, Peggy will be participating in another tax seminar with Fred Kraft at the Alpaca Institute at Northwest Alpacas in Hillsboro, OR. This session will be the first time she will have an opportunity to present the seminar reflecting the changes brought about by the new tax law President Bush signed on February 13th. As always, the session will also include valuable input for creating a business plan.

The new law includes a large increase in Section 179 limitations starting in 2008 (from $128,000 to $250,000 with a ceiling of $800,000) as well as the return of the 50% Bonus Depreciation deduction. So, even if you have attended a seminar before, contact either Fred or Peggy to reserve a seat as this is a great opportunity to learn how the changes may impact your tax position.

Open House and Tax Seminar at Alpaca Woods Ranch

For those of you who have been wanting to come to one of our seminars but didn't want to travel all the way across the country to Oregon, here is your chance. Mark March 29th on your calendars as the 2nd Annual Open House at Alpaca Woods Ranch. Ronnie Nagimesi has been one of our clients and great friends for two years and has put a great deal of time and effort into taking the "woods" part of Alpaca Woods Ranch and turning it into pasture for his wonderful critters. It has been a year since the last open house and there have been plenty of changes in that time—more pastures, new shelters and, of course, the best part—new crias. Refreshments will be served. There is no charge but we would appreciate an RSVP just for planning purposes.

Peggy will be the featured speaker addressing the tax consequences of alpaca ownership. The session will cover the great opportunities this industry has to offer as well as some of the pitfalls to avoid. Here is a brief outline:

Summary of Economic Stimulus Act of 2008 and its impact on you

What is Section 179 and how it impacts the alpaca industry

How Section 179 works; comparing it with regular depreciation

The difference between a Hobby Farm and your farm

What is the IRS looking for when they look at your return

Types of Income and Expenses that should appear on your tax returns

The importance of Business Plans

Question and Answer Session – all the issues that matter to you

The Open House will be from Noon to 5:00 p.m. The tax presentation will be held from 1:00 – 3:00 p.m. Please advise if you will be able to join us on March 29th by either phoning or emailing Ronnie at (770) 972-1247 (mabinda@excite.com), or Peggy at 877-915-0522 (peggy@alpacadigest.com). Here is a Google link for directions. Just add your address in front of Ronnie's and click on the Search button.

Coarse Broads Coming to Alpacas at Tucker Creek

Shearing day is always an exciting time. It represents the end of another year's growth and provides the opportunity to view the quality of each animal's fiber as it is shorn. Sometimes it represents the first time we get to view the true color of last year's cria. How does the fiber compare with each of their studly dads and gorgeous dams. As satisfying as that process may be fiber is probably one of the areas that has consistently caused the most consternation at our farm--how to skirt it (as any of you who know me at all realize--I can be very annul--there is not enough time in the day for me to skirt a fleece and be happy with it), what to make out of it, what mill to send it to. The list goes on--but the fiber goes nowhere. Not to say that we have never processed any of our fiber--we just haven't been thrilled with the end result.

That is all part of the past. This shearing season Carrie Hull from Coarse Broads will be presenting a seminar at our farm the day before shearing begins. Coarse Broads business focuses on educating North American alpaca producers about profit opportunities and the various uses for fiber in an effort to prepare us for the expanding and viable American market that is available today. On Saturday, June 7th we will be presenting a day long seminar at our farm in preparation for shearing on Sunday and Monday, June 8th and 9th respectively. This seminar will be open to our clients only. The focus of the three days will be to give us all a heads up on the potential available to each of our farms.

When the email from Carrie and her business partner, Robyn Kohl, appeared in my inbox on January 12th I could not dial their number fast enough. The idea of having all of our fiber sorted and ready to be sent off for its intended purpose by the end of shearing day was too good to pass up. Here is an excerpt from their site--when you read this you will understand why I found their approach so appealing:

The benefits to the producer--What the producer receives with sorting services:

1. Yearly harvest of fiber sorted into grades by color and length.


2. Individual Sort record on each animal with data that includes the weight of each fleece by body area, grade of each area, comments on luster/brightness, density, and uniformity of crimp, test for tenderness, and sorter comments on the fiber. The individual records are useful in marketing, breeding and general management decision by the producer.


3. Sort Summary for the entire clip. The summary provides information on the amount of fiber in each grade, color, and length category. This enables the producer to make manufacturing decision for their clip and allows them to track their farms productivity and average fleece weight per alpaca.


4. Increase in usable fiber: Utilizing the Certified Sorted Method™ reduces the amount of fiber that ends up in the garden, the burn pile, or trash bin. When we first started sorting, most producers were throwing away at least one large bag of fiber per animal. With good shearing, collection and sorting, typical waste per alpaca is less than 8 oz. per animal!


5. Increase in potential profit: Producers increase profit in several ways.
   *More useable fleece per animal
   *Superior products created from sorted fiber commands higher prices and repeat customers
   *Sorted fiber has less loss during production. Some mills have commented that the loss from processing is 10-15% less than average.
   *The opportunity to become NAAFP Coop member, having access to reduced processing costs, access to retail outlets, and marketing.
   
6. Suggested uses for each grade of fiber. The sorter can assist the producer in recognizing fiber goals, then sort fiber in a manner that best supports those goals. Appropriate uses for each grade will be discussed as well as general processing information and resources to assist the fiber producer. The average grade of the fiber producer's herd can be calculated, giving them feedback on goals they may have already set.


7. Assistance with herd management: Because the sorting process is very thorough, external parasites, skin conditions, stress on the animal which create fiber breaks, etc... are identified and can be address.

At the end of the day, shearing and sorting is completed and a summary of the yearly clip is compiled.

Shearing is over! There is no need to skirt the fiber at a later date. Total weights are recorded by grade, color and method of processing. Your clip is ready for processing! Data available to plan for fiber use and management issues.

When the fiber producer understands what they receive with sorting, they can recognize the tremendous benefit sorting has to offer and how economical it is for them. Usually the sale of the products from the leg/chest/belly will pay for the sorting itself. Other interesting benefits have been reported, including the increased sales of breeding stock due to the ability to answer that age old question,"What do you do with the fiber?"

We look forward to sharing the weekend with all our clients and finding out the value of having our fiber sorted by a certified sorter. The incredible animals in our pastures represent a wonderful living for all of us. We owe it to ourselves and our industry to do everything we can to increase the value of the end product they provide us.