Member Golf OutingDate: August 3, 2018
Join us for a friendly competition on the green. RSVP today for our annual member-only golf outing.
I think everyone has heard the old saying, “When life gives you lemons, make lemonade.” Since grain prices have been quite lemon-like lately, we need to figure out how to make some lemonade. We’d like you to think of Key Cooperative’s AgroMetrix program as your very own lemonade stand. AgroMetrix tools can help you figure out just how many lemons you have, and provide you with a recipe to move forward. The key to the whole program is to use all the resources Key Cooperative has to help you maximize your operation’s potential, whether it is in pricing or agronomic inputs and advice.
One of the areas in which there continues to be some confusion is with the Domestic Production Activities Deduction (DPAD), also known as Section 199. Because the IRS defines the grain payments cooperatives make to their members as “qualified production activities,” Key Cooperative and other cooperatives are able to pass this deduction through to members. A simplified way of thinking of DPAD is that it’s an additional deduction that you can use on your tax return to reduce your income.
This tax benefit goes over and above normal patronage on grain, and it is available for grain sold through Key Cooperative and delivered directly to the processors. If you are a Key Cooperative member, please take advantage of this opportunity to maximize your deductions. Your Key team will work with you to arrange delivery to your grain buyer of choice—we handle the paperwork. If you sell grain through Key Cooperative and are not a member, consider whether this type of benefit would make membership worthwhile for you.
A sample scenario showing the impact DPAD would have made on an individual’s taxable income this past year is on the previous page, along with a four-year history of the total deductions Key Cooperative has passed through to members.
The December USDA Supply and Demand Report was a ho-hummer again—they dropped the corn carryout just marginally from 2.008 billion bushels down to 1.998 due to an increase in non-ethanol food and industrial usage of the whole 10 million bushels. While the corn was a bit of a surprise, the bean carryout dropping 40 bushels to 410 million bushels was expected as a result of increased exports. In spite of the drop, bean stocks-to-use are still in the double digits at 11.2%, compared to 2.6% last year.
I’ll give the usual public service reminder about checking your bins as some problems have shown up with the temperature fluctuations we have had. Please be careful doing it—follow all safety practices. Thank you as always for your patronage, and have a great 2015!
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