Some one smarter than me explain the BTO!

[farmaholic]

Market Place had a show on flipping cars and the "negative equity" (owing more than its trade in value) being added to the purchase price of the new vehicle. I hope this isn't happening with machinery.


Lease lease lease.

[fjlip]

Just thinking about incorperating for tax reasons. Equipment in and land out, should save about $50000 a year in taxes. Is it worth incorporating or not?

We will tell you when we exit...that's the BIG saving

[fjlip]

Market Place had a show on flipping cars and the "negative equity" (owing more than its trade in value) being added to the purchase price of the new vehicle. I hope this isn't happening with machinery.


Lease lease lease.

Ask a dealer, that is exactly what is happening

[bucket]

When you are addicted to the smell of new paint and decals I guess you do whatever to have it.....

****ing equipment hasn't changed much in a very long time and if it can't last more than 250 hours ....something is seriously wrong.

[iceman]

Looking like more a d more of a pyramid scheme, last one to the party gets left with the hot potato.

I believe it's called "The greater Fool theory"

The whole new machinery leasing/buying seems like that game will end badly


Iceman Out

[Richard5]

I believe it's called "The greater Fool theory"

The whole new machinery leasing/buying seems like that game will end badly


Iceman Out

You nailed it ice!!!

Sad thing is I don’t think the ones that are leasing or financing the bulk of the purchase understand this.

If little to manageable debt, spend as you like

[SASKFARMER3]

Talked to a banker friend and most that are flipping every year or two have 0 equity in their equipment and most owe more than the trade in value.

Just saying the dealers are passing on the idiotic price on to the buyer and most aren't aware of this. Blow them out.

Thats another topic for another day.

interested on exit plan FLIP and how you make out.

[MBgrower]

Could you image how much more wealth we would have had we not flipped machinery as often as we do? how much more land we would own, and much larger investment portfolios. Really, when you think of it how much more efficient is a new tracked tractor, or new combine? So old machines break down, but if you had a half decent heated shop, you can spend all winter red lighting/green lighting your own equipment. the cost of repairs is much cheaper than depreciation on new equipment (see Ritchie bros) plus the older equipment is so much simpler. ahh, the lure of new paint, and the need to impress the neighbours.

[farmaholic]

By incorporating you have held the Taxman at bay on a portion of your income.... so be prepared to pay up.

It's not a bad theory to incorporate but it needs to be managed.

MBgrower: there comes a time that new paint does nothing for you! "Egotistically" In fact you think, why the **** am I doing this? I could buy/build a pretty darn good house for the cost of this major piece of equipment that will depreciate to scrap iron value in twenty years! But if you can afford it....to each their own! But its the worst investment going. And people think the land is too expensive....


SF3.... I am ashamed to admit that I really don't know if, when you are about to "hit the wall", you are any better off owning your land personally or through a Corp(and signing personal guarantees). Either way I think the end result is the same!

What I don't understand is, if you are trying to tell me people think they are going to be off the hook if the land is going to be repossessed that is owned by the corp but don't understand that the personal guarantee they signed makes it no different than if they owned the land personally. This is so far from being a reality for me it doesn't concern me! (but is good to know)

[iceman]

You nailed it ice!!!

Sad thing is I don’t think the ones that are leasing or financing the bulk of the purchase understand this.

If little to manageable debt, spend as you like

I'm not sure if it's a AG thing or a society thing. Probably more of a society thing because of a long period of access to such easy capital.

Land regardless of the price in 20 years will still remain a productive asset. You must be able to float it over the long term though. Will that S790, 9340, or 780 be a productive asset in 20 years? You need machinery to farm but this has gotten crazy.


Iceman Out