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    Recent Stories

    Hay Price Outlook

    The current outlook for horse hay supplies and prices in 2014 is more optimistic than last years due to: increasing hay acres in production and good spring rains in many areas, which should boost production.  As always, local growing conditions will have a big impact on what you will have to pay for hay.  It is always best to estimate your total annual hay needs early and contract to fill your needs during the production season.

    Expert Advice

    John CohanJohn Cohan

    Attorney at Law 

    Admin
    Monday
    Feb202017

    New phone app measures pasture acres and more

    Ever wondered how many acres are in a pasture, how much material you will need to build a fence?

    Now there is an app for your smartphone that does just that. It’s available from the Noble Foundation, Ardmore, OK, according to Austin Miles, a research associate with the organization.

    The app is called GeoMeasure.  It is a free download for both iOS and Android smartphones.  With GeoMeasure, you can determine area in square feet or acres.

    Users can determine area or distance either by dropping markers on the device’s screen; or by GPS, which simply means the device tracks your movement as you walk the perimeter of the given area.

    To learn more or download the app, go to: www.noble.org/news/publications/ag-news-and-views/2017/january/determine-distance-with-smartphone.

    Friday
    Dec092016

    Trump administration could bring tax and regulatory changes for horse industry

    By John Alan Cohan, Attorney at Law

     

    For the horse and livestock industries, IRS Regulations have been an important enforcement mechanism.  Many of the Regulations have not been changed for decades, and require the taxpayer to go through numerous hoops to prove that their activities constitute a business rather than a hobby.

    The IRS has been accused of using inappropriate political criteria, or “viewpoint discrimination,” in processing of applications by tax exempt organizations.   President-elect Donald Trump will no doubt replace the IRS Commissioner, John Koskinen, who himself has been accused of obstructing congressional investigations.
     
    The IRS is a bureau of the Department of the Treasury.  Incoming Secretary of the Treasury, Peter Mnunchin, indicates that likely changes of tax law will include a lowering of the corporate tax rate from its current 35 percent level, and a return of more than a trillion dollars’ American companies currently hold abroad to avoid U.S. taxes.
     
    The IRS Commissioner is responsible for the administration and enforcement of Internal Revenue laws.  The IRS Commissioner’s vast powers include prescribing Treasury Regulations administered by the IRS.
     
    A new Commissioner will have the power to revise the IRS Manual, which guides agents in conducting audits.  The Manual has detailed instructions on how to conduct audits for taxpayers in the horse, cattle and other livestock industries.  The Manual should be changed so that auditors will be less aggressive in presuming that losses incurred by taxpayers automatically implies a motivation to generate “tax benefits,” or that a primary motivation is personal pleasure and recreation. 
     
    The Commissioner can help encourage IRS agents to recognize that it takes a significant period of time and effort to develop a superior line of animals, and that almost always in the startup year losses are commonplace.  (This is true as well for most any small business venture.)  IRS agents should also back off from the tendency to second guess decisions made by the taxpayer.
     
    IRS auditors also need to recognize that advertising and promotion of one’s activity may take a variety of forms.  Print advertising is no longer the only means of promotion:  The Internet has opened up opportunities not available in previous decades, and word of mouth advertising has become increasingly important and effective.  Also, the IRS needs to recognize that owners and breeders often become experts in their own right over time, and therefore are entitled to be regarded as experts for purposes of making informed financial decisions.
     
    The IRS Manual should also be modified to inform auditors that a “business plan” need not be in writing, that taxpayers may formulate credible plans, simple and straightforward, other than in written form.
     
    Finally, the IRS must do away with its ill-advised tendency to question taxpayers on how they expect to “recoup” all past losses.  The concept of “recoupment” has been misconstrued and misapplied.  And the concept has been rejected by the Tax Court in an important case, Helmick v. Commissioner (T.C. Memo 2009-220).  The only concern should be forward looking, that is, how the taxpayer expects that the activity will generate an overall profit in the future, not how the taxpayer might recoup the prior loss.
     
    Another systemic problem is that many IRS employees who are caught willfully violating the tax law, or who commit other willful misconduct, are not fired, but may even get promoted!  (See article in forbes.com, Sept., 2015.)  Moreover, why do IRS workers get “performance” bonuses?  We should not allow these bonuses to continue.  This is yet another example of government waste and overreach.
     
    The public interest calls for fair treatment, efficiency and promptness in audits and appeals, and the IRS Commissioner can do a lot to help promote these ends.

     [John Alan Cohan is an attorney representing people in federal and state tax disputes, IRS appeals, and Tax Court litigation, and is a long-standing author of a legal advice column published in numerous sporting magazines.  In addition, he advises organizations on compliance with newly enacted laws and regulations.  John is also author of the book, Turn Your Hobby Into A Business -- The Right Way.  He can be reached at:  (310) 278-0203, or email at johnalancohan@aol.com.  His website is JohnAlanCohan.com.]

    Thursday
    Nov172016

    Strategies to slow horse feed intake

    Some horses eat like pigs and that can cause health problems, according to Krishona Martinson of the University of Minnesota Equine Center.  She notes extended forage time has been linked to health improvements and well-being, including reductions in unwanted behaviors, ulcers, choking, and insulin and glucose responses after feeding.

    Martinson listed a variety of things stable owners and managers can do to slow feed intake by changing how feed is delivered to horses.

    • Slow-feed hay nets.  University of Minnesota researchers evaluated different hay nets to measure effect on horse hay intake rates.  Horses were fed hay at 1% of body weight twice daily off the boxstall floor, and from three different hay nets with large, medium and small openings. 
      The floor feeding and the large-opening nets resulted horses consuming the hay in slightly over 3 hours per feeding.  Consumption time per feeding for medium nets was about 5 hours, and 6.5 hours for nets with small openings.  The longer feeding times are similar to natural grazing times for horses.
    • Grazing muzzles.  The researchers also found that grazing muzzles can help slow horse intake from pasture and grain.  University of Illinois researchers found that these muzzles reduce feed intake by about 30%.
    • Specialized grain feeders.  Texas A&M researchers tested a new feed bucket (Pre-Vent Feeder) and determined it slowed grain consumption and reduced spillage.  Horses pent 21-60 additional minutes eating grain from the feeder compared to a tub or bucket.
    • Obstacles. North Carolina researchers tested grain feeding using a bucket with 4 movable bocce-style balls (4” diameter).  These extended grain feeding time by 4 minutes daily.  The found using the balls produced the lowest glucose and insulin responses compared to other feeding methods tested.
    • Forage quality.  Horse hay feeding time increases as the percentage of NDF (Neutral Detergent Fiber) goes up.  NDF percentages of 65% tend to result in a reduction in hay intake.  Some people call this “busy hay.”  NDF percentages of 40-50% are considered ideal for horses and promote hay intake.  Experts recommend only a small portion of the horse’s hay diet be comprised of “busy hay” high in NDF.
    • Feeding order.  Many experts believe feeding hay before grain slows feed intake.

    All of these strategies offer stable owners options to optimize feeding time and achieve health benefits.  None of these are costly to implement.

    Wednesday
    Sep142016

    AQHA seeks location bids for mounted shooting contest

    AQHA is requesting host-site bids for the 2017 Zoetis AQHA Versatility Ranch Horse and AQHA Cowboy Mounted Shooting world championships and the AQHA Ranching Heritage Challenge Finals, which will be held in 2018. The inaugural Zoetis VRH World was held in 2008 in Denver during the National Western Stock Show. In 2011, the show was relocated to Houston, during the Houston Livestock Show & Rodeo.

    The qualifying period for the Zoetis VRH, AQHA CMS world championships and Ranching Heritage Challenge Finals is January 1 to December 31 each year. The show has been held in mid-March for the past three years. However, according to a recent survey, exhibitors would prefer the event to be held in May or June. The event typically lasts four days, but AQHA would like to expand it to a minimum of five days. It is AQHA's preference that the Zoetis VRH and AQHA CMS world championships, along with the Ranching Heritage Challenge Finals keep these same qualifying dates, with the event dates moved to May or June in 2018.

    Interested organizations or facilities must complete this form to submit a bid. Please be sure to include information you would like the AQHA Executive Committee to consider when reviewing the proposal.
     
    Information on the Zoetis VRH and AQHA CMS world championships is available at:  www.aqha.com/versatility.

    Wednesday
    Apr132016

    2016 hay prices are running 10 percent below last year

    Stable owners are enjoying lower hay prices thus far in 2016 that are significantly lower than a year earlier, according to USDA information.

    Last week’s USDA Agricultural Prices report showed the February all-hay price at $136 per ton, $1 per ton less than the January average price and $17 lower than one year ago. February alfalfa hay prices dropped by $5 per ton from January to $142 per ton, which was $25 per ton less than one year ago.

    The largest month-to-month alfalfa hay price drops occurred in Idaho (minus $20), Ohio (minus $20), Oregon (minus $20), Wisconsin (minus $20), Oklahoma (minus $19), Iowa (minus $15) and Michigan (minus $15). No state recorded a price increase of more than $9 per ton (New York). Data for individual states is presented in the table below.

    The USDA price averages account for all qualities of hay sold, and the final U.S. estimate is a volume-weighted average rather than a simple average of state values. Those states with the most volume sales will impact the final U.S. dollar value more than those states with fewer sales.