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CATEGORIES: Community Impact, Legacy Fund

Commodity contributions can result in enhanced tax benefits

HAMILTON COUNTY, IN – Hamilton County farmers can help their community while saving significant taxes by contributing commodities such as corn or soy beans to Legacy Fund.

When a farmer transfers legal ownership of a commodity to a charitable organization before the commodity is sold, the farmer does not have taxable income from the sale and consequently, minimizes taxes. The farmer may realize savings on federal and state income tax and self-employment tax and may still deduct the costs of production.

Craig Wallace, owner of Wallace Grain Company in Sheridan, Indiana, first discussed a gift of grain with Legacy Fund in the fall 2011. The tax savings were so compelling that he convinced two farmers to join him. Wallace contributed soy beans to Legacy Fund to provide additional funding for a fund in the name of his parents. He convinced another farming family to make similar gifts into their fund. After the ownership of the grain was transferred, it was sold and the proceeds were placed in the funds.

“Gifts like Craig’s make incredible sense,” said Terry Anker, president, Legacy Fund. “First and foremost, gifts of grain enable farmers such as Craig to give back to their community and make a real difference in Hamilton County. They may also provide financial and tax-based benefits for the donor, and that’s especially important in today’s economy.”

As Hamilton County’s community foundation, Legacy Fund, an affiliate of the Central Indiana Community Foundation, can accept gifts of commodities directed to a particular foundation fund. Since specific procedures must be followed to obtain the desired tax treatment of a gift of grain, farmers should notify Legacy Fund before making a gift of commodities.

Farmers should consult with their accountant or tax advisor to determine whether a contribution of commodities is appropriate to their tax situation.

For assistance with a gift of commodities contact one of these individuals: Terry Anker, President, Legacy Fund, at 317.843.2479 x301 or terrya@cicf.org; Mark Robbins, Vice President, 317.843.2479 x302 or markr@cicf.org; or Jan Edmondson, Senior Gift Planning Advisor, CICF, 317.634.2423 x510 or jane@cicf.org.

More about Legacy Fund.