Parched Alta., Sask. get livestock tax deferrals

The annual round of federal drought designations, which provides income tax deferrals for ranchers in affected areas, starts off this year with 26 jurisdictions in Alberta and 76 rural municipalities in Saskatchewan.

Ranchers in the municipalities designated by the federal government can defer a portion of tax owing on income from breeding stock sold due to drought in 2009, the government announced Wednesday.

The tax deferral allows eligible producers in designated areas to defer income tax, in order to help them replenish breeding stock in the following year. In the case of consecutive years of drought designation, producers can defer sales income to the first year in which the area is no longer designated.

To be eligible, a producer needs to have reduced his or her breeding herd by at least 15 per cent. Thirty per cent of income from net sales can be deferred if the herd has been reduced by at least 15 per cent, but less than 30 per cent

Where the herd has been reduced by 30 per cent or more, 90 per cent of income from net sales can be deferred.

Forage yield data isn’t available until later in the year but these designations can be made earlier in the year, based primarily on spring moisture conditions and estimates of forage yield, the government said.

Eligible producers can request the deferral when filing their 2009 income tax returns, and are advised to contact their local Canada Revenue Agency tax services offices for details.

“Informed decisions”

With an earlier designation of eligible areas in place, producers can make “informed decisions” about fall and winter livestock management, the government said Wednesday. More areas may also be designated as the crop year continues.

Central Alberta has experienced “very dry” conditions since last summer, the government said. Precipitation was not adequate to recharge soil moisture and combined with an extremely low snow accumulation this past winter, spring soil moisture conditions were poor.

Well-below-normal temperatures and continued dry conditions throughout the spring have resulted in very poor pasture and forage development, the government said.

West-central Saskatchewan also started off its growing season with insufficient moisture due to limited fall and winter precipitation and “extremely low” runoff. “Exceptionally” low water supplies, feed shortages and well below normal forage production thus significantly impacted producers.

In early July, the government added, southwest Saskatchewan’s moisture conditions deteriorated, resulting in very poor pasture and hay growth.

The list so far

Drought-designated RMs in Saskatchewan for the 2009 tax year now include Val Marie, Happyland, Perdue, Waverley, Deer Forks, Biggar, Mankota, Loreburn, Grandview, Glen McPherson, Coteau, Mariposa, Pinto Creek, King George, Progress, Auvergne, Monet, Heart’s Hill, Wise Creek, Snipe Lake, Eagle Creek, Glen Bain, Newcombe, Glenside, Whiska Creek, Chesterfield, Rosemount, Lac Pelletier, Rosedale, Reford, Lawtonia, Rudy, Tramping Lake, Coulee, Fertile Valley, Grass Lake, Swift Current, Milden, Eye Hill, Morse, St. Andrews, Buffalo, Excelsior, Pleasant Valley, Round Valley, Saskatchewan Landing, Kindersley, Senlac, Milton, Battle River, Riverside, Montrose, Cut Knife, Pittville, Harris, Hillsdale, Enfield, Marriott, Manitou Lake, Maple Bush, Mountain View, Turtle River, Canaan, Winslow, Paynton, Victory, Oakdale, Eldon, Lacadena, Prairiedale, Wilton, Miry Creek, Antelope Park, Britannia, Clinworth and Vanscoy.

Designated areas in Alberta for the 2009 tax year now include Beaver, Lamont, Camrose, Parkland, Ponoka, Red Deer, Flagstaff, Kneehill, Starland, Lacombe, Strathcona, Leduc and Sturgeon Counties; the counties of Minburn, Paintearth, Stettler, Two Hills, Vermilion River and Wetaskiwin; the municipal districts of Acadia, Provost and Wainwright; Special Areas No. 2, 3 and 4; and Improvement District No. 13.

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