Kennedy and Coe CEO writes to House Ways and Means Committee Chairman Dave Camp on behalf of ag industry

Jeff Wald, CEO of agriculture consulting and accounting firm Kennedy and Coe wrote to House Ways and Means Committee Chairman Dave Camp expressing concerns about the proposed tax-law changes.

“The combination of historically thin margins, rising costs of production, and price volatility can dramatically impact the gross receipts that an entity engaged in farming may have from year to year and may not reflect the actual income or loss reported by the entity. As a result, an entity may be pushed into the accrual method of accounting because of a year or two of unusually high prices. Note that for an operation such as a feedlot, there is not any correlation between an increase in gross receipts from high corn prices and an increase in profits. To the contrary, in a time of rising commodity prices, an increase in gross receipts could narrow margins and reduce profitability.”

The letter explains why the proposed changes should be abandoned. It also suggests alternate approaches for consideration if the changes are only modified instead of dropped.

Read Wald’s Letter to Camp 09-26-13


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