Local Farm Credit directors meet with Congresswoman Ann M. Kuster

From left: Gov. Lynch, Congresswoman Kuster, Steve Taylor, Henry Huntington

New Hampshire Second District Congresswoman Ann M. Kuster recently met with two Farm Credit board members from her district during a timeout from campaign activities in Concord, N.H. Former New Hampshire Gov. John Lynch joined the conversation and both expressed their continuing support for Farm Credit service to agriculture and forestry in the Granite State. From left are: Gov. Lynch; Congresswoman Kuster, Steve Taylor of Meriden, a director of Yankee Farm Credit, which serves the western and northern areas of the state; and Henry Huntington of Loudon, a director of Farm Credit East, which covers the six southeastern counties of New Hampshire.

Yankeeaca.com

Farmcrediteast.com

http://kuster.house.gov/

New Due Date for 2016 Forms W-2 and 1099

A reminder from our Financial Records and Payroll Services department.

Effective January 1, 2017, electronic Forms W-2, W-3, 1099 and 1096 are due to the IRS by January 31, 2017!

Previously, electronically filing extended the due date to March 31^st. The new January 31^st deadline now matches the due date for paper filed versions of the forms.
So, what does this mean for you?
Wage reconciliation and 1099 reporting information (Forms W-4 and W-9) must be obtained before year end to meet the new deadline.
And how do you prepare?
Put your ducks in a row now before it’s too late by regularly reconciling your records and payroll.
A few tips to help accomplish this:

• Obtain Form W-9 from 1099 vendors before you pay them.
• Keep a record of all payments made to employees and 1099 vendors.
• Keep a log of all tax payments made throughout the year.
• Adopt an accounting program, such as QuickBooks or CenterPoint, to compile all your business activities in one place and produce tax ready reports.

Yankee also offers records and payroll services. Service options are tailored to your needs. Whether it’s at your place of business or in our office, staff is here to help!
Contact your local office for details.

Q3 Financial Results

As we enter the home-stretch of 2016, Yankee can announce that we had another good quarter.

Our year-to-date income at the end of the third quarter was $7.5 million.  While this is down $809 thousand from the same time last year, we are well within our budget for 2016.

Some factors for this reduction include an increase of $1.1 million in the Provision for Credit Losses, primarily due to the increase seen in loan volume since last year, and an increase of $856 thousand in operating expenses.  These adverse factors were partially offset by an increase of $996 thousand in net interest income and an increase of $200 thousand in other income.

Loans held by the Association at September 30, 2016 were $462.1 million, up 2.9 percent from the end of 2015. The loan portfolio continues to be concentrated in the dairy industry, with 49 percent of loans held invested in dairy businesses.  The second largest concentration is timber with 14 percent of loans held, with maple being the third largest concentration with 11 percent.

Credit quality across Yankee's portfolio remained stable during the quarter and well within the risk-bearing capacity of the Association. At quarter end, 0.3 percent of the Association's loans were classified as nonperforming.  This ratio was slightly better than it was at the end of 2015.  There were no loan charge-offs or recoveries during the quarter.  The Association's capital position remains strong.

Click here for the full quarterly Report to Shareholders and here for the quarterly financial news release.

New Employee - Tess Adone

Tess Adone was hired in October as the Executive Assistant to CEO and President-elect Brenda Frank and also will be supporting the Board of Directors and senior management team. Tess is entering her ninth year of progressive experience as an executive assistant and has worked in the academic, non-profit, and state government sectors. A long-time resident of Vermont, Tess received her M.A. in English from the University of Vermont.

FarmStart- Andrew and Elizabeth Nolan

Andrew and Elizabeth Nolan are a 2016 FarmStart investment for Yankee Farm Credit, working with Loan Officer Kyle Lussier. They are using their FarmStart investment for initial working capital to help assist in the purchase of an existing dairy farm and operate as Nolan Family Farm, LLC.


Andy has a degree in Dairy Farm Management Technology from Vermont Technical College, and Elizabeth is a Registered Nurse. After graduating, Andy became the herdsman for Nor-Dic Farm in Panton, VT where his father was an employee for many years and Andy spent much time growing up. As the previous owner of Nor-Dic Farm was looking to retire, but wanted to keep the farm going Andy and Elizabeth saw an opportunity to start Nolan Family Farm.


Nolan Family Farm will be shipping milk to Agri-Mark and milking 200 cows. Andy has been strategic in his downsizing from the former operation of milking 600 cows to help make the transition more viable. They have a lease agreement for the property, plans in place for purchasing equipment, budget planning strategies with help from Yankee’s Liz Bayne and support from the previous owner to aid in their transition to business owners.


Yankee Farm Credit is excited to partner with the Nolan’s in their new business endeavor.

Meet Yankee's Newest Certified General Appraiser-Nate Goddard

Nate Goddard, out of Yankee’s St. Albans, VT office, has been granted a Certified General Appraiser license by the Vermont Board of Real Estate Appraisers, allowing him to appraise all types of real property.  Nate was hired as an Appraiser Trainee in 2013.

The process of obtaining a certified general license is lengthy and extensive, requiring about three years of designated study, testing and supervised practical experience. Each course taken to meet the requirements has a test and there is one BIG test at the end.  The field experience requires supervision and guidance from an experienced Certified General Appraiser and several appraisal reports are selected by the Board for review prior to issuing a license. While this process is long and rigorous it does produce well trained appraisers which is a definite advantage for the appraiser, for the profession and for Yankee.

Nate grew up on a dairy farm in Orwell, VT.  He got his BA from University of Vermont and continues to live in the Burlington area.  Nate has excellent dairy industry knowledge and is capable of handling the valuation of the largest and most complex dairies in the region.  He has also developed a high level of knowledge in the maple industry.  We congratulate Nate for his accomplishment and wish him every success in his career.  We’re proud Nate is part of Yankee’s appraisal team!

2016 Tax Planning

-a reminder from the tax staff at Yankee

I’m sure that tax planning is the last thing on the minds of most dairy farmers this year, however, while many farms have struggled with low milk prices recently, it is important to remember that if you are making regular debt payments those payments are creating taxable income as the principal portion is not deductible. In addition, if your payables have increased significantly from 2015 you are going to have less ordinary expenses available to offset your income in 2016. Even if you haven’t had a profitable year, tax planning can still be a beneficial exercise. For example; if you have funds sitting in a traditional IRA account you may be able to convert some or all of that IRA to a Roth IRA and pay little or no tax. The benefit to this is that after 5 years the principal and earnings from the Roth can be withdrawn tax free. Another item to consider is harvesting winners and losers from your portfolio to take advantage of the 0% Capital Gain rate for taxpayers in the 15% tax bracket. It’s a good way to free up some tax free cash.

For 2016 the $500,000 Section 179 deduction and 50% bonus depreciation are both available. Both these items have limits and phase outs, consult your tax specialist if you are considering using them.

While both Section 179 and 50% Bonus Depreciation can be useful tools for managing your Federal tax liability, most states are not allowing bonus depreciation and not every state’s section 179 limit has been increased to match the Federal limit.

Prepaying expenses is one of the most common tax management practices that we see; it is also an area that is receiving increased scrutiny from the IRS during audits. So here is a quick review of the rules for prepaid expenses. There are three conditions which must be met in order for a cash basis taxpayer to claim a deduction in the year the prepayment is made.

 

1. The expenditure must be a payment for a supply and not merely a deposit. (You need to have an invoice clearly stating the quantity purchased and the price, delivery before the end of the year is not required.)
2. The prepayment must be made for a valid business purpose and not merely to accelerate a tax deduction. (Some examples of valid business purposes include but are not limited to: ensuring the availability of the supply item or locking in a guaranteed price.)
3. The deduction must not result in a material distortion of income.

In addition you need to be aware that there is a 50% rule that limits the deduction for prepaid expenses to 50% of deductible farm expenses unless you are a “qualified farm-related taxpayer”.

Please contact your Farm Credit Tax Specialist if you have any questions or if you wish to schedule a tax planning meeting.

New Employee - Dan Shepard

Dan Shepard joins our Williston office (though he will be a frequent guest in Middlebury) as Controller on October 17, 2016. Dan has provided financial and accounting services to private companies for the past 6 years at Gallagher, Flynn and Company, LLP in South Burlington VT. He has worked with closely held, venture capital and private equity owned companies in a broad range of industries from breweries, manufacturing, and hospitality to non-for-profit and cooperative organizations.   

Dan sits on the Board of Directors for Special Services Transportation Agency, Inc., based in Colchester, VT. He currently serves as Treasurer and is a member of the Executive committee and Finance committee. SSTA’s mission is to provide accessible transportation for people who have specialized mobility needs.  He is also member on the Board of Directors for HOPE. Works Inc., based in Burlington, VT and serves the Chittenden County community. HOPE Works provides crisis counseling and advocacy for those whose lives have been affected by sexual violence.

He graduated from the State University of New York at Plattsburgh, where he earned his Bachelor of Science degree in Accountancy and Business and grew up just south of Lake George, NY.

Dan is an avid motorcyclist. He has toured much of the Northeast and Canadian Maritime on two wheels and a tent (current bike is a Honda Africa Twin) and has hundreds of pictures and videos to share; and is up for discussion all things internal combustion engine anytime. Additional he loves to race sailboats, golf, ride dirt bikes (drz400e), and hike.

Dan is a member of the American Institute of Certified Public Accountants and Vermont Society of CPAs . In addition to his CPA license he also holds the Charted Global Management Accountant designations from the AICPA and is a member of the CGMA society.

Welcome to the Yankee Farm Credit Team!

New Director - Ken Deon

On August 12, 2016 Kenneth F. Deon was appointed by the board to serve as an outside director. He grew up in Plattsburgh, NY and graduated from SUNY Plattsburgh.  He is a retired CPA who worked for KPMG for most of his career. He was the managing partner of the KPMG office in Burlington, VT from 2004 to 2007 and the Albany, NY office from 2007 to 2015.  Mr. Deon has more than 30 years of experience in providing audit and advisory services to clients in a number of industries.  He has a thorough understanding of industry operations, processes and controls, as well as knowledge of technical accounting issues such as business combinations, regulatory accounting and financial reporting.  His audit experience includes IPO/SEC experience, including Sarbanes-Oxley regulatory requirements. Through the years he has been involved in a number of professional and civic organizations.  He has served as an Adjunct Professor in Accounting at Union Graduate School and at Saint Michael’s College.  Mr. Deon retired from KPMG in 2015 and currently lives in Greer, South Carolina.


We are pleased to welcome Ken to the Yankee Farm Credit Team!

New Employee - Kevin Channell

Kevin Channell joined the White River Junction credit team as a Loan Officer on September 26th.  For the past four years Kevin has performed farm consulting in Indiana and New England while developing and operating a small-scale diversified community farm.  Prior to that he established a 28-acre organic produce farm in Fairlee near Dartmouth College, managing all aspects and after nine years sold the successful operation which is still operating profitably.  He is committed to making a positive impact on farms and farm families.

Welcome to the Yankee Farm Credit team!