Agrinvest

[GDR]

So everybody likes Agrinvest better than the other BRM programs, understandable why even if it's not a very large amount of money. My question is how many of you leave the money in an account and how many take it back out each year. Personally I have 6 figures in my Agrinvest account because I am too cheap to pay tax on the taxable portion, but could use the money in multiple ways. The intention was to withdraw it in a lower margin year therefore not incurring a large tax burden, the problem being is as farmers we often have pushed sales ahead and still created a tax burden even as margins decline.


Would it be a good ask by our farm groups to allow Agrinvest funds to be withdrawn tax free, as a way to help out farmers without costing government big dollars that will just get lost in bureaucracy? Money would get spent in the economy. Should be lots of money in accounts or am I the only one holding on to it?

[farming101]

If you are not incorporated you are going to pay a lot of tax.

If you are trying to be cheap on saving taxes and yet you want to power your farm ahead you are dealing with a no-go. Can't do both.

I don't think anybody will hear your suggestion to drop the tax on AgriInvest withdrawals.

A lot of bad news in this response but don't see it any other way. Hope I didn't misunderstand something in your post...

[blackpowder]

I for one cash it out immediately.

[Marusko]

The money is worth more paying off the operating loan so I pull it.

Allowing tax free withdrawals would disproportionately benefit the ones who could afford to leave it in.

Unless it only applied to future agri-invest. But it's such a small amount of savings you're targeting anyway. I'd rather lobby for gov to increase to 2x or 3x farmers contributions instead of matching dollar for dollar.

[Sodbuster]

It’s a easy choice for me, you can leave it the bank and collect. .001% or take it out. I choose to invest in myself and my farm. As far as taxation Corp pays less but eventually when it comes out of the Corp you will pay more.

[Richard5]

So everybody likes Agrinvest better than the other BRM programs, understandable why even if it's not a very large amount of money. My question is how many of you leave the money in an account and how many take it back out each year. Personally I have 6 figures in my Agrinvest account because I am too cheap to pay tax on the taxable portion, but could use the money in multiple ways. The intention was to withdraw it in a lower margin year therefore not incurring a large tax burden, the problem being is as farmers we often have pushed sales ahead and still created a tax burden even as margins decline.


Would it be a good ask by our farm groups to allow Agrinvest funds to be withdrawn tax free, as a way to help out farmers without costing government big dollars that will just get lost in bureaucracy? Money would get spent in the economy. Should be lots of money in accounts or am I the only one holding on to it?

You can't free up cash without paying tax, clear and simple. Managing the rate is one thing, avoiding it is another. Its either tax or interest - Tax is essentially once, interest is much longer and potentially forever if you keep reborrowing to buy down the tax bill.

[GDR]

You can't free up cash without paying tax, clear and simple. Managing the rate is one thing, avoiding it is another. Its either tax or interest - Tax is essentially once, interest is much longer and potentially forever if you keep reborrowing to buy down the tax bill.

Yes I get that, personally are in the process of rolling our partnership to a corporation and have long term plans on withdrawing Agrinvest & RRSPs to offset the minimum tax requirement from the capital gains rollover... so there is a plan. Just has been unappetizing to withdraw funds the last number of years when hitting higher tax brackets for those additional dollars of income. Not that I dont have debt and no I dont feel flush with cash.

[fjlip]

We did Agri Invest, 3 years ago. When rolled into Corp, saved some tax...

[GDR]

So I know this will be an unpopular idea but here goes.

So appears I'm one of the few that have left Agrinvest money in the account to accumulate. When the program was designed that was how it was meant to be used, to cover small margin declines and Agstability was to kick in for the larger margin declines.

With the exception of those that have experienced individual catastrophic events on their farm, looking back the last 10 plus years profitability has been pretty decent for farmers. So I would argue in theory if used as intended most should have emergency cash available to them. Having said all that, how can we ask the government to give us handouts of money they dont have to us when we have not managed their previous risk management properly. Are we just wanting our share because other industries and people are getting some? Or is the situation dire on the farm and I just don't see it?

Locally canola about 10.30, feed wheat 5.90, feed barley 4.50, yellow peas close to 8, graded grains higher. Not saying prices couldnt be higher, but are they really that bad? And how has covid 19 hurt prices?

Livestock is different, prices have dropped and markets have vanished, only thing I will say is for most of us it has only been a paper loss so far and may or may not turn out fine in the end. The feedlots and finishing barns may need help now, that is pretty much an instant crisis.

Fyi, I am not in Agristability, if there were government handouts I would take them. I do think the government has handed out too much money to too many people already.

[farming101]

So I know this will be an unpopular idea but here goes.

So appears I'm one of the few that have left Agrinvest money in the account to accumulate. When the program was designed that was how it was meant to be used, to cover small margin declines and Agstability was to kick in for the larger margin declines.

With the exception of those that have experienced individual catastrophic events on their farm, looking back the last 10 plus years profitability has been pretty decent for farmers. So I would argue in theory if used as intended most should have emergency cash available to them. Having said all that, how can we ask the government to give us handouts of money they dont have to us when we have not managed their previous risk management properly. Are we just wanting our share because other industries and people are getting some? Or is the situation dire on the farm and I just don't see it?

Locally canola about 10.30, feed wheat 5.90, feed barley 4.50, yellow peas close to 8, graded grains higher. Not saying prices couldnt be higher, but are they really that bad? And how has covid 19 hurt prices?

Livestock is different, prices have dropped and markets have vanished, only thing I will say is for most of us it has only been a paper loss so far and may or may not turn out fine in the end. The feedlots and finishing barns may need help now, that is pretty much an instant crisis.

Fyi, I am not in Agristability, if there were government handouts I would take them. I do think the government has handed out too much money to too many people already.

Well, first you have to have grain to sell. If a farm's grain is under a snowbank yet, I wouldn't be surprised if they used up all their AgriInvest. It can go that quick. It is not a huge amount of money to keep the bills paid when you have nothing to sell. There are farms that left pretty much their entire canola crop out over winter.

Not all farms are doing well with all that has happened in the last 2-3 years with markets and weather.

If you would be so kind as to indicate where you live there is a lot of grain that could come your way.
I am less than an hour from the largest softseed oilseed crush plant in North America. Posted prices are under 10.30 out till Feb 2021

[jazz]

Any money sitting in a govt program is a target for that govt. Agrinvest is a tiny program for a few hundred thousand farmers. Think Justin wouldn't hit that for revenue after all this?

But Galen Westons companies are on the TSX along with other corporate cronies. I would say your money is working better and safer there.

[Guest]

Well, first you have to have grain to sell. If a farm's grain is under a snowbank yet, I wouldn't be surprised if they used up all their AgriInvest. It can go that quick. It is not a huge amount of money to keep the bills paid when you have nothing to sell. There are farms that left pretty much their entire canola crop out over winter.

Not all farms are doing well with all that has happened in the last 2-3 years with markets and weather.

If you would be so kind as to indicate where you live there is a lot of grain that could come your way.
I am less than an hour from the largest softseed oilseed crush plant in North America. Posted prices are under 10.30 out till Feb 2021

we have saw a few $10 specials , but most canola is $9.50-$9.70 here

[GDR]

Well, first you have to have grain to sell. If a farm's grain is under a snowbank yet, I wouldn't be surprised if they used up all their AgriInvest. It can go that quick. It is not a huge amount of money to keep the bills paid when you have nothing to sell. There are farms that left pretty much their entire canola crop out over winter.

Not all farms are doing well with all that has happened in the last 2-3 years with markets and weather.

If you would be so kind as to indicate where you live there is a lot of grain that could come your way.
I am less than an hour from the largest softseed oilseed crush plant in North America. Posted prices are under 10.30 out till Feb 2021

I am only 40% done 2019 harvest will be a few days yet before we can get out there ,so I get it is a challenge.

Yesterdays price from Richardson Olds was 10.23 for April.