DO I DEDUCT OR NOT? Generally the ANSWER IS DEDUCT!

Now that tax season is basically over . . . except for those who have filed an extension . . . it seems appropriate to address a topic which shows up in my inbox throughout the year as well as during tax season . . . the question of deducting alpaca related expenses during the first few years of operation.

The email generally goes something like this "I have been doing alpacas for a year or two but have never claimed any of the alpaca related expenses as I was told I could not until I sold something . . . is this true?" The simple and most often the appropriate answer is "deduct".

The IRS addresses this issue in a variety of places . . . the link above goes to Publication 535, Page 5 . . .

Presumption of profit. An activity is presumed carried on for profit if it produced a profit in at least 3 of the last 5 tax years, including the current year. Activities that consist primarily of breeding, training, showing, or racing horses are presumed carried on for profit if they produced a profit in at least 2 of the last 7 tax years, including the current year.

That same publication discusses not-for-profit activities and some of the factors the IRS looks at when they determine whether a business has a profit motive or not.

You can still go back and amend your returns if you feel it appropriate for your particular tax situation. An in depth conversation with your tax preparer should be your next step or begin looking for a new preparer. Not all preparers or accountants are farm friendly . . . even those who are not should be able to assist you in making the decisions required to properly reflect the true picture of your farming activities. Bottom line . . . the tax return is your responsibility . . . it is their duty to advise you on the rules . . . but you are ultimately responsible for the content of your return.

Tucker Creek Crias Go to Shows

As many of you know Alpacas at Tucker Creek has chosen not to go to shows. Whether that is a good or a bad decision for your farm only you can decide--it is the path we have chosen for us. But don't let it be thought we don't see the value in the show process. And to that end is the subject of our latest blog.

We are happy to annouce the results of the first Alpacas at Tucker Creek offspring to go to show. Both Snowy River Alpacas, Colfax, CA and BrushWalker Alpacas of Geneseo, IL went to shows this weekend. The show results are from the Alpaca Western Extravaganza in Reno, NV and IAOBA Alpaca Riverfest in East Peoria, IL respectively. To say we are proud would be an understatement.

At AWE Snowy River Alpacas - Hailey & Ric Parker had the following results:

Tucker Creek's Ranger (out of Studmaster MSA Hemingway's Tequila) - Medium Fawn Class - 2 year old male - 2nd Place

They had a problem color checking this boy as his fiber was so dense they had difficulty getting the color chart down to his skin . . . what a great problem to have.

Tucker Creek's El Diablo (out of Studmaster Pacific Crest Accoyo Paul Revere) - Medium Fawn Class -
Yearling - 4th Place

Tucker Creek's Shadow (out of Studmaster MFI Peruvian Glacial Storm) - Dark Brown Class - Yearling - 2nd Place

This class was so tight for first and second places the judge spent considerable time comparing the two and after five minutes of side by side comparison decided the first place winner was slightly more dense than Shadow.

At IAOBA Alpaca Riverfest - BrushWalker Alpacas - George & Joanne Brush - had the following results:

Tucker Creek's Warlock (out of Studmaster MFI
Peruvian Glacial Storm) - Medium Brown Class - Yearling - 3rd Place

The judge said that the two above him had denser fleece but that Warlock's fineness was above the whole class.

We could not be happier with the results and effort put forth by these farms. Each of these males is a first generation Studmaster progeny--can you just imagine what will come out of breedings to these wonderful males.

Change in Tax Filing Deadline - April 17th

Wow . . . this one slipped right by me . . . but I wanted to share this once I realized it applied to all of us. Normally, only six states and the District of Columbia are impacted by a holiday known as Emancipation Day. This year that holiday lands on Monday, April 16th. Because of a federal statute enacted decades ago, holidays observed in the District of Columbia have an impact nationwide, not just in D.C. Under recently enacted city legislation, April 16 is a holiday in the District of Columbia. The IRS recently became aware of the intersection of the national filing day and the local observance of the new Emancipation Day holiday after most forms and publications for the current tax filing season went to print. So . . . long story short . . . tax filing day is Tuesday, April 17th. One more day to crunch numbers.