Why Give Grain?

Why is giving grain better than writing a check to your church or charity? Because there are significant tax benefits of giving grain instead of cash.

• Donated grain is not recorded as income; so you may save all or some of the following taxes: 

• Self-employment tax of approximately 15% .
• State and county taxes of approximately 5%
• Federal income tax (e.g. those who do not itemize deductions.)

The total tax saving can be substantial.  (See example #1)

• You can "prepay" your giving.  The gifts you make into a Donor Advised Fund may be held in the fund for years. So, you can give today (perhaps to level income for tax purposes) and grant the money later.

• You may avoid costly tax deduction phase-outs.  Some tax benefits are taken away at higher levels of adjusted gross income (AGI).  These benefits are retained when you give grain rather than cash. 
  
  
• You may pay fewer income taxes on your social security benefits.  Gifts of grain lower your Adjusted Gross Income (AGI), thereby reducing taxes on social security benefits.
  
  
• You may receive additional tax benefits.  IRS rules limit deductions to 50% of your AGI.  (10% for C-corporations.)  Since the donated grain is not reported as income, you can give more and save more taxes than those limits allow. This is helpful either if you are especially generous or if you wish to “prepay” your donations in a given year.   (See example #2)

• The grain you give will not count as income in your government payments limitation caps calculations.  If you are a high-earning famer, please contact us for more details. You may be able to effectively redirect significant sums of money from the government to causes you would rather support.