October 17, 2014 Weekly Round Up

Thank you all for your kind words after my big announcement last week.  I am happy to report that I am settled into my new office in Amarillo and back at it.  Yesterday, I had the chance to present on water law for the Big County Master Naturalists group in Abilene via webcam.  Welcome to those of you visiting the blog from that event!

Here are some of the ag law stories in the news this week.

Video Addresses Proposed Water Pipeline Project.  The Texas Tribune put together a great video discussing the proposed water pipeline between Burleson County and San Antonio.  The video does a great job of showing the varying perspectives on this issue, and even interviews of farmers on opposite sides–one concerned about the impact the proposed well field could have on his operation, the other welcoming the lease payments.  [View video here.]

Limiting Liability Risk of Farm Operations. This week, Farm Futures ran a series called “Farming Exposed” that outlined various situations in which farmers could find themselves sued and offered practical solutions to avoid potential liability.  Tips include considering various business entities, understanding the details of your insurance policy, and implementing training and employee requirements to avoid risk.  [Read Part 1 here and Part 2 here.]

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CRP Payments to Non-Farmers Not Subject to Self Employment Tax.  In an important case for landowners who are not active farmers but receive Conservation Reserve Program (“CRP”) payments, the 8th Circuit Court of Appeals overturned a Tax Court decision in Morehouse v. United States.  In this case, a Minnesota resident inherited 1,200 acres of land in South Dakota, which he enrolled in CRP.  The landowner hired a local farmer to implement the conservation plan commitments and the landowner had no direct involvement in the farming activities other than signing the CRP agreement and accepting the payments.  The IRS took the position that the landowner’s CRP payments were subject to the 15% self employment tax, despite the fact that the landowner was a non-active participant in the agricultural operation.  The lower Tax Court agreed, but last week the 8th Circuit reversed and made clear that non-active landowners and passive investors are not required to pay self employment tax for CRP payment income.  Importantly, this case is binding only in those states in the 8th Circuit, but this ruling could be persuasive authority to courts in other states.  [Read more here and here.]

Lawsuit Challenging Missouri Right to Farm Constitutional Amendment.  The “Right to Farm” Constitutional Amendment passed by Missouri voters in August is facing its first legal challenge.  The challengers allege that the statutory language was misleading and prejudicial.  Specifically, they object to the use of the word “citizen” in describing who will be protected by the provision, claiming that the law protects not only individual Missouri farmers and ranchers, but would also apply to foreign-owned corporations.  [Read articles here and here.]

WTO Rules in Favor of United States in Poultry Dispute with India.  The World Trade Organization announced that it has ruled against India’s ban against U.S. poultry imports, finding that the ban violates WTO rules.  India’s 2007 import ban was defended as being necessary to prevent avian influence, but India offered no scientific evidence to support this concern.  The US poultry industry is hopeful that this ruling will be a step to open doors to India’s market. [Read article here.]

Estate Planning Moves You Should Make in Your 30’s.  As my own birthday nears, this article caught my attention.  Many thirty-something’s are busy building careers and families and overlook the need to have an estate plan.  The article outlines 6 steps that 30 something’s should consider:  (1) a will; (2) a living will; (3) a durable power of attorney; (4) a health care proxy; (5) life insurance; (6) a retirement fund.  This list is great for anyone–regardless of age–to consider and implement.  [Read article here.]

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