A few lessons learned from the recent tax season include these.

The new Section 199A deduction was likely much smaller than planned for farmers. This is due to low levels of farm income and due to the fact that cooperatives pushed through a large (the former) domestic production activities deduction (DPAD) at the end of 2017. So, for 2018, there was either a very small or no DPAD from the cooperative.

The IRS still does not have a handle on the new law. We still wait on guidance from the IRS on the Section 199A deduction. And, we recently wrote on IRS Letters coming due to confusion over the “non-footing” tax forms.

Trade-ins aren’t as fun. The new tax law prohibits like-kind exchange reporting on the trade-in of machinery, vehicles, and other similar property. For 2018, this often meant that gain was reported upon the trade-in of equipment, when such gain was often not reportable under earlier law.

With over 20 years of experience in public accounting, Amanda Bechen CPA owns Bechen & Company PC located in Wagner, SD, and can be contacted at 605-384-4200 or www.bechenco.com.