GFM Network News

Farm Financial Planner: Farm transfer could lead to “hobby farm” status

Passing on an unprofitable farm can raise tax challenges for the next generation

A couple we’ll call George and Mary have farmed in south-central Manitoba for the last 35 years on a third-generation family farm. Each is 60 years old. Their dilemma is generational transfer. Their issue is the fundamental low level of profitability that could, if not handled properly, cause the farm owner to lose their ability to […] Read more

The financial failure of a farm can cause added friction, especially when it comes time to transition to the next generation.

No farm profits mean a change of plan is needed

This family’s generational ownership shift plan doesn’t work without farm profits

A family we’ll call the Browns has farmed in southern Manitoba for four decades. Over the first 30 years, they grew their farm to 2,000 acres of pasture and grain. Today, Jack Brown is 67 and Molly, his wife, is 66. Their son, Max, and his wife Chloe have three children under 10. Farm income […] Read more

Using annuities for an income stream

Guarding Wealth: They’re rock solid investments and eliminate market risk, but annuities are not cheap

Annuities are life insurance running in reverse. Rather than paying a premium for benefit at the death of the insured, an annuity stars with a lump sum and pays out income until the death of the person getting the money, the “annuitant” in annuity-speak. Payments will sometimes last longer than a lifetime, if there are […] Read more

Farm Financial Planner: Time to decide what to do with the land

After years of renting out the land, this widow is ready to make her next financial choices

In southern Manitoba, a widow we’ll call Eleanor, 73, wants to decide what to do with 420 acres of farmland she inherited two decades ago when her husband died. She never farmed the land, just rented it to a neighbour. Each of her three sons has a successful off-farm career. The decision? What to do […] Read more

Farm Financial Planner: Grandchild will inherit widow’s farm

Managing taxes across the generations takes extra effort and a careful approach

Celeste, as we’ll call her, is 75. She lives in south central Manitoba and owns a 320-acre farm. Her husband, who we’ll call Edward, passed away earlier this year. The farm, a mixed grain and grazing operation, was profitable for many years. The couple put about $382,300 into off-farm investments over the years. Celeste’s problem […] Read more

Farm Financial Planner: Lessening the sting of the AMT after land sales

With planning, retiring farmers can reduce the burden of the Alternative Minimum Tax

A couple we’ll call Herb, who is 67, and his wife, Mary, 60, farm 600 acres of grain and hay and another 500 acres of pasture in central Manitoba. They have put much of their effort into a 100 head cow-calf operation. Their two children, Suzy, 32, and Astrid, 29, are married and have no […] Read more

If your farming is considered a hobby (for example, you only raise a few 
farm animals or have a plot to grow food for your own table), you can’t 
deduct any expenses or losses.

Save your 2016 seed money

Farm Management: Let the CRA tax experts help you reap the most from what you sow

Farmers of all types, from dairy to fruit to livestock, contribute to the economy and to the healthy lives of Canadians. The Canada Revenue Agency (CRA) wants to help make filing your income tax and benefit return easier so you can save your time and energy for the harvest. If your farming is considered a […] Read more

Make the least of your farm taxes

It's that time of year again. Here are some farm tax tips direct from the CRA

Canadian farmers of all types — from dairy to fruit to livestock — contribute to the healthy lives of Canadians. The Canada Revenue Agency (CRA) has made filing your taxes easy, so you can save your energy for the harvest. The agriculture and agri-food industry is vital to the economy, and the CRA wants to […] Read more

Slash your tax bill by transferring the farm

Resigned to quit, a farming couple makes a plan 
to slash taxes and hand the operation to their children

In south central Manitoba, a couple we’ll call Harry and Marge, 81 and 73, are tackling the problem of transferring their 1,760 acre farm, mostly pasture, and their 120 cattle, to their children who we’ll call Bob, 46, and Cathy, 42. Harry and Marge know they have to give up control sooner or later, given […] Read more