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.
Thursday, February 28, 2008
Tuesday, February 12, 2008
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 fo
r 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.
r 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.
Friday, February 1, 2008
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:
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:
- Yearly harvest of fiber sorted into grades by color and length.
- 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.
- 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.
- 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!
- 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. - 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.
- 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.
Sunday, December 23, 2007
Year End Planning
The end of the year is upon us--don't know if it is just a sign of getting old--but I just don't know how the year went by so fast. As many of you know we just experienced one of the worst storms to ever hit the Oregon coast. It took a while for our electric, telephone and Internet services to be returned to normal; but the alpacas never missed a beat. We went down to check on them several times during the storm and they were just as contented as could be--with torential rains and 100 mile per hour winds howling outside the barn--they are amazing critters.
Part of what comes with the end of the year is our innate need to plan. What do we need to do before year end? Will we buy alpacas or other business equipment before year end or should we do it next year? Several links appear below to help you look at several different scenarios. Two of them are sample business plan spreadsheets--both with an initial purchase of six female alpacas averaging $15,000 a piece--one includes a demonstration of buying all breedings the other includes the purchase of two herdsires.
6 Bred Females With No Herdsire
6 Bred Females With 2 Herdsires
The third pdf is a listing of business plan inputs for various alpaca related expenses.
List of Business Plan Inputs
As you review these reports you will note a very conservative approach. No forms of income are included other than the sale of alpacas and those are reflected at very conservative prices. As you put this type of analysis together for your farm or proposed farm keep in mind what you feel confident your various forms of income will be. Many times over the years as we have been asked by new farms to help them develop their business plans and we find that many give us revenue from agistment, transport, fiber sales, consignment sales, etc. all before they have even started in the business. If you are planning to provide transport services and are an individual who enjoys driving cross country then this alternative has merit. But, if you hate to drive, why include transport services in your business plan? Be realistic in what you are planning. A business plan changes over time. It is not meant to be a static document. It is a guide to your future. When things change your business plan will need to change.
The percentage we use for birth rates (80%) is quite low because we want to plan on the low side--what if you have some females who don't get pregnant (it happens)--there are times when a cria may die (sad but true). There are years where your percentage of males may be greater than 50%--our second year we had 15 males out of 21 births. That didn't fit with our business plan; but all those boys have been sold. It just meant we had to look at our planning in a different light.
As you put your business plan together review the 97 questions the IRS presents in their Market Segment Specialization Program entitled: IRC Section 183: Farm Hobby Losses with Cattle Operations and Horse Activities (despite the name it would be the guideline for any audit involving alpaca breeding operations). The list appears in Appendix D. These are all questions the IRS is going to ask you--if they are already answered in your business plan you will be ahead of the game.
http://www.irs.gov/pub/irs-mssp/a1farmls.pdf
Give a holler if you have questions. David and I wish you the very best as we begin the countdown to 2008 and would like to thank all of our friends, clients and vendors for their part in making this a wonderful 2007.
Part of what comes with the end of the year is our innate need to plan. What do we need to do before year end? Will we buy alpacas or other business equipment before year end or should we do it next year? Several links appear below to help you look at several different scenarios. Two of them are sample business plan spreadsheets--both with an initial purchase of six female alpacas averaging $15,000 a piece--one includes a demonstration of buying all breedings the other includes the purchase of two herdsires.
6 Bred Females With No Herdsire
6 Bred Females With 2 Herdsires
The third pdf is a listing of business plan inputs for various alpaca related expenses.
List of Business Plan Inputs
As you review these reports you will note a very conservative approach. No forms of income are included other than the sale of alpacas and those are reflected at very conservative prices. As you put this type of analysis together for your farm or proposed farm keep in mind what you feel confident your various forms of income will be. Many times over the years as we have been asked by new farms to help them develop their business plans and we find that many give us revenue from agistment, transport, fiber sales, consignment sales, etc. all before they have even started in the business. If you are planning to provide transport services and are an individual who enjoys driving cross country then this alternative has merit. But, if you hate to drive, why include transport services in your business plan? Be realistic in what you are planning. A business plan changes over time. It is not meant to be a static document. It is a guide to your future. When things change your business plan will need to change.
The percentage we use for birth rates (80%) is quite low because we want to plan on the low side--what if you have some females who don't get pregnant (it happens)--there are times when a cria may die (sad but true). There are years where your percentage of males may be greater than 50%--our second year we had 15 males out of 21 births. That didn't fit with our business plan; but all those boys have been sold. It just meant we had to look at our planning in a different light.
As you put your business plan together review the 97 questions the IRS presents in their Market Segment Specialization Program entitled: IRC Section 183: Farm Hobby Losses with Cattle Operations and Horse Activities (despite the name it would be the guideline for any audit involving alpaca breeding operations). The list appears in Appendix D. These are all questions the IRS is going to ask you--if they are already answered in your business plan you will be ahead of the game.
http://www.irs.gov/pub/irs-mssp/a1farmls.pdf
Give a holler if you have questions. David and I wish you the very best as we begin the countdown to 2008 and would like to thank all of our friends, clients and vendors for their part in making this a wonderful 2007.
Wednesday, November 28, 2007
Tax Time is Approaching . . . quickly
As I prepare for the year end Alpaca Business and Tax Planning seminar being presented jointly with Northwest Alpacas on Friday a couple of IRS links looked very worthy of sharing on the blog.
The first one is entitlted "Tips for Choosing a Tax Preparer".
The individual you select to prepare your return is a very important decision but no matter how qualified that individual may be remember the contents of the return are your responsibility! If you don't know where to turn to find a qualified farm-friendly accountant contact another local farm and ask if they are pleased with their accountant/preparer, check with your local AOBA affiliate, or your state society for CPAs.
The second one addresses the 2008 Standard Mileage Rate--50.5 cents per mile for business miles. Follow the link and you can review a summary of the mileage rates for medical, moving and charitable purposes.
There is still time to sign up for the tax seminar on Friday--just follow the link above. Along with the tax and business planning presentation it is a fun exchange of questions and experiences with participants enrolled from all parts of the country.
The first one is entitlted "Tips for Choosing a Tax Preparer".
The individual you select to prepare your return is a very important decision but no matter how qualified that individual may be remember the contents of the return are your responsibility! If you don't know where to turn to find a qualified farm-friendly accountant contact another local farm and ask if they are pleased with their accountant/preparer, check with your local AOBA affiliate, or your state society for CPAs.
The second one addresses the 2008 Standard Mileage Rate--50.5 cents per mile for business miles. Follow the link and you can review a summary of the mileage rates for medical, moving and charitable purposes.
There is still time to sign up for the tax seminar on Friday--just follow the link above. Along with the tax and business planning presentation it is a fun exchange of questions and experiences with participants enrolled from all parts of the country.
Thursday, November 8, 2007
Trying to Catch up . . .
We have been very busy and obviously have not updated the blog on a regular basis. Guess we need to learn to post shorter messages.
The big news in the camelid industry right now is a virus that has been showing up throughout the country. Our farm has had no incidence to date but we know farms who have. Luckily all their critters are fine. There is no definitive diagnosis at this point but we wanted to share a link from the International Camelid Institute http://www.icinfo.org/index.html you might want to review and add to your Favorites. The ICI was founded by Dr. David Anderson at The Ohio State University (Peggy's alma mater) in 2001 and is an information repository, veterinarians, owners, academicians, regulatory agencies and others can access and obtain essential information for everyday situations from research.
Will try to do better on updates--several are in the edit stage right now--but wanted to get this quick message off about a great resource whether it be for critical virus information or daily care issues.
We hope all your critters are happily grazing in their pastures and you are having a great autumn in your area of the country.
The big news in the camelid industry right now is a virus that has been showing up throughout the country. Our farm has had no incidence to date but we know farms who have. Luckily all their critters are fine. There is no definitive diagnosis at this point but we wanted to share a link from the International Camelid Institute http://www.icinfo.org/index.html you might want to review and add to your Favorites. The ICI was founded by Dr. David Anderson at The Ohio State University (Peggy's alma mater) in 2001 and is an information repository, veterinarians, owners, academicians, regulatory agencies and others can access and obtain essential information for everyday situations from research.
Will try to do better on updates--several are in the edit stage right now--but wanted to get this quick message off about a great resource whether it be for critical virus information or daily care issues.
We hope all your critters are happily grazing in their pastures and you are having a great autumn in your area of the country.
Saturday, September 22, 2007
Way behind on telling you about babies!
It has been very busy on the farm and we suddenly realized the last seven cria had not yet been officially presented to the world via the blog--so here they are.
August 18 - Khani (named after Khani Cole one of our favorite female vocalists) out of Tucker Creek's Chandra and Hemingway's Bogart. She may be a light fawn or beige--only time will tell--but she is dense and crimpy and conformationally perfect.
August 19 - Lollipop (named after the late 50's hit of the same name) out of Tucker Creek's
Franchesca and MFI Peruvian Glacial Storm. We realized she is, much to our dismay, our only Glacial Storm cria this year as all the other Glacial Storm bred females sold last year. Not that we are complaining! She is just as gorgeous as her cousin--Chandra and Franchesca are 1/2 sisters out of our incredibly fine Karoline (now owned by Alpaca Woods Ranch in Snellville, GA). Karoline had a male this year out of MFI Peruvian Impact--Alpaca Wood's Augustus--if you are looking for a future herdsire--he should be worthy of your time and interest.
September 19 - Tucker Creek's Jewell out of El Bello's Eloisa and EC Sun Tzu--what a gorgeous little doll. To date Eloisa had only given us males--Tucker Creek's Spenser from last year is still on our annual watch list. Only one or two males make the list each year. So far he has not disappointed us. And we are certainly not disappointed with the results of this breeding!
August 18 - Khani (named after Khani Cole one of our favorite female vocalists) out of Tucker Creek's Chandra and Hemingway's Bogart. She may be a light fawn or beige--only time will tell--but she is dense and crimpy and conformationally perfect.
August 19 - Lollipop (named after the late 50's hit of the same name) out of Tucker Creek's
Franchesca and MFI Peruvian Glacial Storm. We realized she is, much to our dismay, our only Glacial Storm cria this year as all the other Glacial Storm bred females sold last year. Not that we are complaining! She is just as gorgeous as her cousin--Chandra and Franchesca are 1/2 sisters out of our incredibly fine Karoline (now owned by Alpaca Woods Ranch in Snellville, GA). Karoline had a male this year out of MFI Peruvian Impact--Alpaca Wood's Augustus--if you are looking for a future herdsire--he should be worthy of your time and interest.
September 9 - a mother and daughter delivery duo - Faiks' Athena and Faiks' Elana presented us with a male, Tucker Creek's Creedence (medium fawn), and a female, Tucker Creek's Clearwater (white), each sired by Hemingway's Bogart. We had been hoping for a trio for the family as Athena's other daughter, Victoria, was also due at the same time--but the R component of CCR did not appear until several days later.
September 14 - the arrival of Tucker Creek's Revival to finish off the three memorable names of the 60's group by the same names commonly referred to as CCR. He is the gorgeous result of a breeding between Tucker Creek's Victoria and EC Sun Tzu.
September 19 - Tucker Creek's Jewell out of El Bello's Eloisa and EC Sun Tzu--what a gorgeous little doll. To date Eloisa had only given us males--Tucker Creek's Spenser from last year is still on our annual watch list. Only one or two males make the list each year. So far he has not disappointed us. And we are certainly not disappointed with the results of this breeding!
And before leaving the pasture we found that Cazie's Octavia was delivering the first cria born to Rising Moon Alpacas out of Preston, NV. Another gorgeous EC Sun Tzu male named Rising Moon Eclipse. We are thrilled to add them to our group of affiliate farms and look forward to many years of mutual alpaca fun and success.
Our breeding season is almost over. Only three more cria to come--all belonging to clients--and all out of Sun Tzu. To say that we have been thrilled with the results of our first breeding season with Sun Tzu would be an incredible understatement. He is doing a magnificent job with crias on the ground ranging in color from white to black--every single one displaying his dense and crimpy fiber as well as his friendly dispostion. Many thanks to Mike Safley at Northwest Alpacas for his personal selection of this outstanding herdsire standing stud exclusively at Alpacas at Tucker Creek. Limited breedings available for 2008.
Don't forget National Alpaca Farm Days are next weekend. Take part in whatever way you can. These unique critters have afforded us a wonderful lifestyle and the industry has only scratched the surface. If you are not already involved--check them out--there is probably a farm near you!
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