General
Wondering how others pay themselves from their farm income. I am not looking for how much other make. More like, Is it so much per acre farmed, or is it a percentage of farm income, or something else. Just curious as to how i pay myself compared to other farm operations. Thanks for any responses.
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Farm is S corporate so housing utilities food health ins cell phone is all paid. Get paid minimal monthly wages and yearly bonus with commodity’s. Don’t pay much payroll tax.
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sounds smart
I pay myself from commodity wages that way I'm not paying into social security and its up to me to save. So I get paid in bushels.
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Pay myself minimal amount to cover household expenses. LLC operation. Agree with comments about financing pay, if you have loans you either pay more on them or some for you. Tax person will give good advice
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I pay myself just enough monthly to cover living expenses then settle up at the end of the year. I try to contract enough crop early in the year (winter). To cover my costs then at the end of the year sometimes I have extra sometimes I’m short. To me Farming is a lifelong retirement build up. Not a huge cash flow builder. My balance sheet says I’m worth way more than 10 years ago, but I really don...
Dad had a banker tell him years ago that you need to gross 10x what you want to take home to make a living just off your operation. That’s part of how we structure our living cost and our operation.
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We are at 30x and still we are barely hanging on.
I pay to farm. $190,000 in 2019.
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We keep cash to make all payments for 12 months. Check it at the first of every month. Anything extra goes to LOC. If LOC is 0 then the extra gets paid out.
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****** could you elaborate some please? By payments do you mean mortgage? Or land + equipment payments? Or all of that + more?
Here's what I use, with 1000 acre farm for example, half corn, half beans.
$15 × 3 hrs. per acre of corn = $45. = $22,500
$15 x 2 hrs. per acre of beans = $30. = $15,000
Plus 5% of gross farm sales for management.
600,000 sales = $30,000
Total = $67,500
I didn't invent this, it's simply ...
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Very interesting. Have never seen anything like this before. If I follow it, I get a raise. ******. Thanks for the info.
I just may have to decrease the budget somewhere else to make it happen.
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Bi monthly check for absolute bare minimum expenses housing, food, etc ( ok I lied, plus enough to take my fiancé out to dinner twice a month). Then I get paid for custom work ( i.e tillage and or planting plus 5%) everything else gets put back in farm and we pay off debt or expand
Just take what you need to live and leave the rest alone borrowed or your own cash no matter what been there done that resurrected
Write a check every month out of line of credit we have set salary for each owner/employee
We have a C Corp. my dad owns it, I manage it. I’m paid a salary plus 5000 bushels grain to market myself. There is a tax benefit there for the corporation.
My dad is paid salary, grain, plus cash rent on the few farms he owns.
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I write a check from the farm account to my wife every month as our monthly draw/family living, a set amount just enough to get buy. We try our hardest to live on that amount but if an unexpected living expense comes up in the middle of the year I might need to give ourselves an early bonus. After the new year and getting through my books to see how we did I usually give ourselves a little family ...
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I’d say it depends on your long term game plan. Do you want to grow your farm bigger or do you want stay the same size and just coast on what you have? We have 4 of us on our farm and we all work 40 hour work weeks plus we farm 2300 acres. At the end of the year we save our farm money and invest some into the farm and some into other assets.
Well, I am trying to get paid to farm.
My farm is incorporated also. There is me and one other full time employee, we both get a bi-monthly paycheck. Mostly curious as to how other farm owners figure out how much to pay themselves.
Lets start here...when you figure all the wages you pay out in a year how much is it per acre. 2019, I was around $55 / acre. Its my 2nd biggest expense, land r...
You get paid to farm?? But seriously, since we created an S-Corp as the working entity, everyone just gets a monthly salary and then a dividend at the end of the year.
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Good choice.......... should help avoid most of the self employment tax I would guess
I pay myself in beer usually.
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