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The Management Calendar
Farm Business Management Update, February 2008 - March 2008
Gordon Groover (firstname.lastname@example.org), Extension Economist, Farm Management, Department of Agricultural and Applied Economics, Virginia Tech
Listed below are the items that need to be included on the farm business managers’ calendar for the first quarter of 2008.
- Taxes and related items: Make sure your federal taxes are mailed by March 1 unless you pay estimated taxes, then the deadline is April 15. Virginia income tax returns must be postmarked by May 1.
- Need to find out more information about federal taxes? The Farmers Tax Guide IRS Publication 225 is online and can be found at: http://www.irs.gov/pub/irs-pdf/p225.pdf.
- A summary of changes and basic federal income tax information is published annually by George F. Patrick in the Department of Agricultural Economics at Purdue University. Look for the publication titled “Income Tax Management for Farmers” at http://www.agecon.purdue.edu/extension/pubs/taxplanning.asp.
- Decide how much you’ll contribute to an IRA for 2007 and set goals for 2008. If you use a certified financial planner (CFP), consider his/her usefulness in helping plan for retirement, college, insurance coverage, and other items. Visit the web site for the CFP organization to get information on services and standards required for planners. You can search for a CFP in your area at http://www.cfp.net/.
- Motor Vehicle Cost is a topic in the Iowa State Ag Decision newsletter. Authors Don Hofstrand and William Edwards discuss information needed and methods to determine the costs of operating a car or semi. This article can be found at http://www.extension.iastate.edu/agdm/crops/html/a3-40.html.
- Want detailed information on farm-based recreation (agri-tourism) in the U.S.? Then take a look at a recent USDA Economic Research Service publication titled Farm-Based Recreation: A Statistical Profile. The paper can be found at http://www.ers.usda.gov/Publications/ERR53/
- Get the farm’s 2007 financial records closed out: Post all income and expenses paid during 2007 in your record book or accounting software. You still have time to conduct an end-of-the-year inventory of all the farm assets and liabilities to provide data for the farm’s net worth statement.
- Need another copy of the Farm Record Book: Annual Expenses and Receipts Virginia Cooperative Extension publication 446-017? Contact your local extension office and ask for the request 446-016. The price is $12.00.
- Using your 2007 records to develop an itemized list of income and expenses. The categories found on the IRS Schedule F can serve as a starting point for estimating net income for the farm business. Compare your results to previous years, looking for both weakness and strengths.
- Seek assistance from Virginia Cooperative Extension’s farm business management agents, lenders, or your accountant to develop a detailed financial analysis of your farm business, including the major 16 financial ratios. These ratios and a detailed financial analysis can be generated by using the Center for Farm Financial Management program FINAN. FINAN and other computer programs can be purchased annually for approximately $100 or the whole analysis and planning package of three computer programs for $395. Details are at http://www.cffm.umn.edu/Software/FINPACK/.
- Using last year’s financial and production records, finalize your projected budgets, cash flow, and income statements for 2007. If you use Quicken® or QuickBooks® make use of the budget section to create a 2008 budget based on 2007 records. 2008 budget entries can all be modified to reflect anticipated changes in 2008, like higher feed fertilizer costs.
- Take your 2007 financial records and 2008 projected whole-farm budgets and cash flow statements to your lender to discuss line-of-credit needs and plans for 2008. Using the FINPACK programs or your Quicken® or QuickBooks® can help with this process.
- Grain and livestock producers should have their marketing strategies/plans in place for 2008 marketing year. Be sure to check with your local Farm Service Agency for changes in government programs and signup deadlines. Be sure to visit the Weekly Roberts Agricultural Commodity Market Report for market updates. The report is posted at http://www.ext.vt.edu/news/periodicals/roberts/.
- The end of February and March 15 are the cutoff dates for signing up for most crop insurance polices in Virginia (dates depend on insurance product and where you live). Details on crop insurance are best discussed with a local crop insurance agent. You can locate a local agent by visiting the following web site http://www3.rma.usda.gov/apps/agents/.
- Interested in finding a listing of all types of agricultural software? Then the best place to look is our neighbor to the north, Alberta Agriculture and Food. They have the most comprehensive listing of computer software designed for farm and agribusiness on the web http://www.agric.gov.ab.ca/app68/agsoft.
Virginia Cooperative Extension