Why pay taxes when you can purchase alpacas instead? You can love and enjoy your taxes through alpacas! Purchasing alpacas allows you to have control over where your money goes which greatly benefits you in many ways—not only emotionally by loving your alpacas but also financially through their potential returns of 30 to 74% along with many other tax benefits such as depreciation and additional deductions of capital assets. Furthermore, alpacas are 100% insurable. Can stocks do this? Absolutely not! Alpacas are lovable and tangible assets that don’t disappear into thin air – what you are now accustomed to seeing every month when receiving your bank/stock statements.
The return on your initial investment can multiply at a strong and steady rate as your alpaca herd grows. Furthermore, you will receive numerous tax benefits and incentives that make your investment even more attractive along the way, even before you sell your first alpaca. Deductible expenses, capital gains benefits, and insurable, depreciable investments are just the beginnings of the many benefits the world’s greatest livestock investment has to offer.
The many tax benefits of owning alpacas are the most significant benefit of the alpaca industry, and they have gotten better every year:
- On May 28th, 2003 President Bush put into public law “The Jobs and Growth Tax Relief Reconciliation Act of 2003. This is extremely good news which has tremendously positive affects on the alpaca industry! With this advent, the Section 179 deduction of the tax code has been raised from $24,000 to $100,000. In February 2008, President Bush raised it to $250,000! This means that the IRS now allows a $250,000 tax deduction for the purchase of an alpaca or many alpacas in that tax year. So instead of paying Uncle Sam, you can purchase alpacas and reap the many benefits yourself.
- In addition, there have been very favorable changes in the treatment of the sale of long-term capital gains, thus you do not have to pay Uncle Sam as many taxes on the profits you make when selling your alpacas and making money through the alpaca industry!
- The additional 30% depreciation which took effect beginning September 11, 2001 has now been increased to 50%. Thus if you are not using the Section 179 benefits for purchasing alpacas or related items to augment to your alpaca farm, you can use this additional first year depreciation. (An alpaca or items purchased to augment your farm and property can typically be depreciated over a five-year period or 20% per year, so this can be a true windfall depending on your current situation. Current expenses are also deductible.)
This is a great time to consult a tax advisor for the specifics as these many benefits relate to you!
Article by Angel Forbes-Simmons
August 1, 2006