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Year-End Tax Strategies for Farmers

In the most recent episode of the AgCredit Said It podcast, we talked with Alex Schomaeker of Shultz Huber & Associates, a CPA and consulting firm, about the upcoming tax season. In the episode, Alex provides insights into the impact of the 2024 tax changes, the importance of planning for tax deductions, and strategies for managing capital gains and estate taxes. The conversation covers various tax-related topics pertinent to farmers and business owners, including changes in tax laws, depreciation deductions, capital gains, health savings accounts (HSAs), estate taxes, and common year-end tax planning mistakes. 

Here are a few highlights from the episode:

  1. Tax Changes for 2024: Discussion on the lack of significant tax changes due to the election year, with a focus on depreciation deductions and the phase-out of bonus depreciation.  
  2. Depreciation Strategies: Explanation of bonus depreciation and Section 179 deductions, including their impact on tax planning for 2024. Bonus depreciation was reduced to 60% in 2024, down from 80% in 2023. Section 179 deduction limit is $1,220,000.00
  3. Capital Gains: Overview of capital gains, strategies for deferring taxes, and the importance of planning with an accountant.  
  4. Health Savings Accounts (HSAs): Brief discussion on the benefits and tax implications of HSAs for farmers. 2025 limits increasing by approximately 3%.
  5. Estate Tax and Farm Transitions: Explanation of estate tax exemptions, upcoming changes, and the importance of planning for farm transitions.  
  6. Year-End Tax Planning: Common mistakes and tips for year-end tax planning, including the importance of planning and potential deductions.  

To hear more on this topic, tune into Episode 73 of the AgCredit Said It podcast. Listen in your favorite podcast app or on our website here: https://www.agcredit.net/news/episode-73-year-end-tax-strategies