Category: Agricultural regulations

Plan how best to work with your local FSA office

Ann Johanns

Contributed by Steve Johnson, Extension Farm Management Field Specialist, sdjohns@iastate.edu

Steven Johnson

The ongoing COVID-19 situation has changed the way your local USDA Farm Service Agency (FSA) office is conducting business with producers this spring. Local FSA offices are currently using alternative methods to provide service and ensure compliance with FSA provisions. Appointments can be made by phone, mail, or e-mail – rather than face-to-face interactions. Once producers have completed planting their 2020 spring crops, they should contact the local FSA office to obtain their certification maps to complete the annual acreage certification process.

The following is a 4-step process provided by a county FSA office in Iowa to their producers for completing their 2020 acreage report:

  1. Your local FSA office can provide farm/tract maps upon your request. They can provide them through the mail or e-mail. Once received, write in a legible pen what crop is planted in each field, including hay ground, grassed waterways, terraces, CRP, etc. and the approximate acreage amounts in those areas. 
  2. Next enter the planting date for each field below the crop type.
  3. If the producer shares the crop with another producer(s); list each individual/entity and their respective share of the crop. The total of listed shares must equal 100%.
  4. If the producer is unable to legibly write the crop, planting date, acres and producer shares (if necessary); then provide a sheet of paper along with the map that lists the field number, the crop, date planted, acres and shares.

Once you have all the acreage on your tract maps accounted for, contact your local FSA office to schedule a phone appointment to go through your maps. This can be handled in one of two ways:

Option 1) You may return your completed maps to the county office for loading into the crop certification software via mail, e-mail, fax, or the drop box located outside your local FSA office.

Option 2) FSA staff can contact you and go through your maps over the phone together. This includes FSA updating your crops/dates/acres/shares and entering them into the crop certification software and allowing you to provide any other pertinent information.

In either case, you will subsequently receive the printed acreage form for your signature in the mail or via e-mail. Indicate to FSA your preference when contacted. Then return your signed FSA Form 578 via mail, e-mail, fax or drop box located at your local FSA office. The deadline is July 15, 2020 for filing this form .

Producers should plan to keep good records at planting each year and file a timely FSA Form 578. Annually these records include the date, the crop and acres planted, and producer shares along with the reference to the farm number. Do not forget you will need to include hay ground, grassed waterways, terraces, CRP, etc.

Filing an accurate and timely acreage report for all crops and land is important. This report is an essential part of determining your eligibility for critical programs, including crop insurance, price support, disaster relief and conservation programs.

Remember, both the FSA office and your crop insurance agent will need accurate planting information and your signature when you complete the acreage certification FSA Form 578. The planted acres on this form are verification for your crop insurance agent in determining your 2020 crop insurance coverage, and thus your final premium to be paid this fall.

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Income Tax Changes for 2019

Ann Johanns
Charles Brown headshot

Contributed by Charles Brown, Extension Farm Management Field Specialist, crbrown@iastate.edu

The Tax Cuts and Jobs Act (TCJA) was signed into law December 22, 2017. Among many changes, it created new tax brackets for 2018 thru 2025. It also eliminated the deduction for personal exemptions and raised the standard deduction in 2019 to $12,200 for single fliers, $24,400 for married filing jointly and $18,350 for head of households. Keep in mind that most of the changes in TCJA end in 2025 and move back to pre-2018 tax law.

Table 1. Tax Brackets and Rates, 2019

Section 179 Expense election was one of the changes that was made permanent. In 2019, this is now $1,020,000 and the phase-out starts at $2,550,000. On Iowa returns, the maximum amount is $100,000 and the phase-out starts at $400,000. In 2020, Iowa couples with the Federal amounts.

One of the other major changes in the TCJA was the repeal of like-kind exchange treatment for traded personal property. Under old law when a farmer traded machinery, the farmer depreciated the difference paid plus any remaining basis on the item traded in and no taxes were due. Under TCJA when a farmer trades machinery, the trade is considered a sale in the amount the dealer allowed for the trade-in, triggering ordinary taxable gain, and the farmer gets to depreciate the full purchase price of the machinery received. If the farmer does not want to pay tax on the gain of the trade-in, they are forced to use Section 179 or bonus depreciation to offset the taxable gain. Iowa did not couple with the Federal change in 2018, but maintained the old like-kind exchange rules. In 2019, for Iowa returns, farmers may use the old rule for like-kind exchanges or use the new Federal rule. In 2020, Iowa will couple with the Federal rule.

If farmers are forced to use Section 179 or bonus depreciation to offset gains from trading machinery, there can be other consequences. Excessive accelerated methods of depreciation reduce net Schedule F income, possibly taking it down to $0 or maybe even a negative situation. IRA and other retirement plan contributions are based on earned income (Schedule F). The deduction for self-employed health insurance is based on Schedule F net income. Contributions for self-employment tax are based on Schedule F net income. Reducing Schedule F income affects money available for retirement planning and other “above the line” deductions taken on the 1040. Also new in 2018 was the new “post card” 1040 Form that also had multiple schedules attached to it. After numerous complaints, there is another new 1040 Form for 2019. This one is a combination of the old 1040 and the 1040 from 2018. Maybe eventually they will get it right. I am not sure I can stand more simplification in our tax code.

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Farm Employee Management: Farm Safety and Hiring Youth on the Farm

Ann Johanns

Contributed by Melissa O’Rourke, B.S., M.A., J.D. Farm & Agribusiness Management Specialist, Iowa State University Extension & Outreach, morourke@iastate.edu

MelissaORourke2-Nov2011At this writing (May 2014) summer is approaching and many farm and other agribusiness operations will consider hiring youth for summer employment.  This makes it a particularly good time to review some guidelines related to hiring young people on the farm.  This article will outline a few guidelines, and also provide some web-based resources with answers to other questions.

We sometimes see tragic accidents—deaths and serious injuries— involving young farm workers.  These kinds of deaths and injuries to young people served as the impetus for regulators to propose strengthening child labor rules related to farm employment in 2011.  However, the US Department of Labor (“DOL”) abandoned proposed regulations in favor of increased farm safety programs.

The proposed regulations would not have applied to children working on farms owned by their parents under what is known as the “parental exemption” which allows children of any age who are employed by their parent, or a person standing in the place of a parent, to perform any job on a farm owned or operated by their parent or such person standing in the place of a parent. However, the proposals would have had other impacts in non-family farm employment situations, such as prohibiting youth (in all employment) from using cellphones or other electronic devices while operating power-driven equipment. Children under the age of 16 would have been prohibited from operating almost all power-driven equipment with limited exemptions for student learners.  After taking input, the DOL issued a statement regarding withdrawal of the proposals noting that the “administration is firmly committed to promoting family farmers and respecting the rural way of life, especially the role that parents and other family members play in passing those traditions down through the generations.”  Rather than adopting the proposed regulations, the DOL sought to work with rural stakeholders to develop educational programs to reduce accidents to young workers and promote safer agricultural working practices.

The need for continued vigilance and enhanced farm safety programs is undisputed. In the meantime – and particularly because of significant media attention given to this issue – farm producers have questions regarding the current rules for youth employment in farm and other ag-related occupations.

The basic guidelines include the following:

  • Youths of any age may work at any time in any job on a farm owned or operated by their parents.
  • Youths ages 16 and above may work in any farm job at any time.
  • Youths aged 14 and 15 may work outside school hours in jobs not declared hazardous by the DOL.
  • Youths 12 and 13 years of age may work outside of school hours in non-hazardous jobs on farms that also employ their parent(s) or with written parental consent.
  • Youths under 12 years of age may work outside of school hours in non-hazardous jobs with parental consent, but only on farms where none of the employees are subject to the minimum wage requirements of the FLSA – meaning small farms.
  • Local youths aged 10 and 11 may hand harvest short-season crops outside school hours for no more than 8 weeks between June 1 and October 15 if the employer has obtained special waivers from the DOL.

Again, minors under the age of 16 may not work in hazardous occupations in agriculture unless the youth is employed on a farm owned or operated by the parents. Also, 14- and 15-year old student learners enrolled in vocational agricultural programs are exempt from certain hazardous occupation prohibitions when certain requirements are met; and minors aged 14 and 15 who hold certificates of completion of training under a 4-H or vocational agriculture training program may work outside school hours on certain equipment for which they have been trained.

Hazardous occupations in agriculture would include the following particular examples:

  • Operating a tractor of over 20 PTO horsepower, or connecting or disconnecting an implement or any of its parts to or from such a tractor;
  • Operating or working with a corn picker, grain combine, hay mower, forage harvester, hay baler, potato digger, feed grinder, crop dryer, forage blower, auger conveyor, unloading mechanism of a nongravity-type self-unloading wagon or trailer, power post-hole digger, power post driver, or nonwalking-type rotary tiller;
  • Operating or working with a trencher or earthmoving equipment, fork lift, potato combine, or power-driven circular, band or chain saw;
  • Working in a yard, pen, or stall occupied by a bull, boar, or stud horse maintained for breeding purposes; a sow with suckling pigs; or a cow with a newborn calf (with umbilical cord present);
  • Felling, buckling, skidding, loading, or unloading timber with a butt diameter or more than 6 inches;
  • Working from a ladder or scaffold at a height of over 20 feet;
  • Driving a bus, truck or automobile to transport passengers, or riding on a tractor as a passenger or helper;
  • Working inside: a fruit, forage, or grain storage designed to retain an oxygen-deficient or toxic atmosphere; an upright silo within 2 weeks after silage has been added or when a top unloading device is in operating position; a manure pit; or a horizontal silo while operating a tractor for packing purposes;
  • Handling or applying toxic agricultural chemical identified by the words “danger,” “poison,” or “warning” or a skull and crossbones on the label;
  • Handling or using explosives; and
  • Transporting, transferring, or applying anhydrous ammonia.

The examples summarized above are based on federal regulations, but there may also be applicable state rules. Depending on the state where the youth employment takes place, those state rules should be consulted, and the law setting the most stringent standard (either state or federal) must be observed.

It is impossible to over-emphasize farm safety for all workers, both youth and adults. Producers should conduct farm safety audits and institute an on-going farm safety education program. Additionally, producers should consult with their own legal counsel for specific advice on any employment or liability questions that may arise, and consult with their insurance professionals to assure that adequate liability coverage is maintained for the operation.

Finally, here are some web-based resources with more information about hiring youth on the farm:

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Hiring Youth on the Farm: Child Labor Regulations in Agriculture

Ann Johanns

Contributed by Melissa O’Rourke, B.S., M.A., J.D. Farm & Agribusiness Management Specialist, Iowa State University Extension & Outreach, morourke@iastate.edu

The need for continued vigilance and enhanced farm safety programs is undisputed. The basic guidelines regarding the current rules for youth employment in farm and other ag-related occupations include the following:

  • Youths of any age may work at any time in any job on a farm owned or operated by their parents.
  • ŸYouths ages 16 and above may work in any farm job at any time.
  • ŸYouths aged 14 and 15 may work outside school hours in jobs not declared hazardous by the DOL.
  • ŸYouths 12 and 13 years of age may work outside of school hours in non-hazardous jobs on farms that also employ their parent(s) or with written parental consent.
  • ŸYouths under 12 years of age may work outside of school hours in non-hazardous jobs with parental consent, but only on farms where none of the employees are subject to the minimum wage requirements of the FLSA – meaning small farms.
  • ŸLocal youths aged 10 and 11 may hand harvest short-season crops outside school hours for no more than 8 weeks between June 1 and October 15 if the employer has obtained special waivers from the DOL.

Again, minors under the age of 16 may not work in hazardous occupations in agriculture unless the youth is employed on a farm owned or operated by the parents. Also, 14- and 15-year old student learners enrolled in vocational agricultural programs are exempt from certain hazardous occupation prohibitions when certain requirements are met; and minors aged 14 and 15 who hold certificates of completion of training under a 4-H or vocational agriculture training program may work outside school hours on certain equipment for which they have been trained.

Hazardous occupations in agriculture would generally be described as the following:

  • Operating a tractor of over 20 PTO horsepower, or connecting or disconnecting an implement or any of its parts to or from such a tractor;
  • Operating or working with a corn picker, grain combine, hay mower, forage harvester, hay baler, potato digger, mobile pea viner, feed grinder, crop dryer, forage blower, auger conveyor, unloading mechanism of a non-gravity-type self-unloading wagon or trailer, power post-hole digger, power post driver, or non-walking-type rotary tiller;
  • Operating or working with a trencher or earthmoving equipment, fork lift, potato combine, or power-driven circular, band or chain saw;
  • Working in a yard, pen, or stall occupied by a bull, boar, or stud horse maintained for breeding purposes; a sow with suckling pigs; or a cow with a newborn calf (with umbilical cord present);
  • Felling, buckling, skidding, loading, or unloading timber with a butt diameter or more than 6 inches;
  • Working from a ladder or scaffold at a height of over 20 feet;
  • Driving a bus, truck or automobile to transport passengers, or riding on a tractor as a passenger or helper;
  • Working inside: a fruit, forage, or grain storage designed to retain an oxygen-deficient or toxic atmosphere; an upright silo within 2 weeks after silage has been added or when a top unloading device is in operating position; a manure pit; or a horizontal silo while operating a tractor for packing purposes;
  • Handling or applying toxic agricultural chemical identified by the words “danger,” “poison,” or “warning” or a skull and crossbones on the label;
  • Handling or using explosives; and
  • Transporting, transferring, or applying anhydrous ammonia.

The rules summarized above are based on federal regulations, but there may also be applicable state rules. Depending on the state where the youth employment takes place, those state rules should be consulted, and the law setting the most stringent standard (either state or federal) must be observed.

It is impossible to over-emphasize farm safety for all workers, both youth and adults. Producers should conduct farm safety audits and institute an on-going farm safety education program. Additionally, producers should consult with their own legal counsel for specific advice on any employment or liability questions that may arise, and consult with their insurance professionals to assure that adequate liability coverage is maintained for the operation.

For more information see:

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Call before you dig…

Ann Johanns

Melissa O’Rourke, ISU Extension Farm & Agribusiness Management Specialist

As pointed out on the Iowa One Call website www.iowaonecall.com , Iowa law requires farmers to notify Iowa One Call at least 48 hours prior to all excavation.  Saturdays, Sundays and legal holidays are excluded, so additional time must be allowed under those circumstances.

Excavation does not include what might be termed “normal” farming operations such as plowing, cultivation, planting and harvesting. However, other farm operations may be considered as excavations which trigger the Iowa One Call requirement.

Excavations in the farm setting include chisel plowing, sub-soiling or ripping more than 15 inches in depth, drain tile excavation and installation, terracing or digging.  Excavation also includes driving a post in a new location other than repairing a fence in its existing location.

There are all sorts of buried pipelines, telecommunications cables, and other types of buried facilities that may exist on farm property.

If a farmer fails to notify Iowa One Call, that farmer may face civil penalties and be held liable for damages caused to these buried facilities.

It is advantageous for Iowa farmers to comply with the Iowa One Call system because such compliance provides a liability exemption for farmland owners.

An owner of farmland used in farm operations (see Iowa Code section 352.2) who complies with Iowa One Call will not be held responsible for damages to underground facilities if the damage occurred on the farmland in the normal course of farm operation. Of course, the exemption does not apply if the landowner intentionally damages the underground facility or “acts with wanton disregard or recklessness” in causing damage to an underground facility such as pipeline or buried cables.

And farmers should not make any assumptions about the depth of a buried cable, pipeline or other facilities. 

It is easy to plan ahead and make the toll-free call to Iowa One Call to notify of the intended excavation.  Underground facilities will be marked with paint and/or colored flags to approximate the location of the buried facilities.  Iowa law allows for an 18-inch tolerance zone on each side of the marking, so excavation should be avoided within the tolerance zone.

If excavation is needed in the vicinity of the markings, additional guidance is available through Iowa One Call regarding how to safely accomplish the operations without causing damage or encountering hazards.

More information is available at www.iowaonecall.com.  The phone call is toll-free by either dialing 811, or calling 1-800-292.8989.

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