F line 37 b, losses if subsidies received

[Gretel]

Here I am thinking the end is near and my software is yelling at me. Since 2010 farmers can no longer just check the box 37a that all investment is a risk if they also received subsidies. Now form 6198 is required and I am totally at a loss what in the world the beginning basis is. How do you figure basis for a farmer who is in business since decades? Maybe I am just having a nightmare?

Can anyone help? I am totally thrown off guard with this. Looked like an easy finish up and now this! Mind you, loss is will under $10,000.

[Gretel]

OK, calmed down a little. After reading some posts on this subject on the web and looking at the instructions for form F, here are my conclusion (don't agree with other posters): If total expenses are less then $300,000 for a single filer then none of the losses are limited and I actually have to check box 37a. If I check 37b, IRS expects to see form 6198, which I believe is not required if expenses are under limit.

IRS seems to be confused themselves, what a surprise.

[Gretel]

I filed for an extension and appreciated input after tax season. I think box 37b should be checked after all but what a pain to go through for a small subsidy.

The input I am mainly looking for is how to best come up with the beginning basis for a small farmer who did nothing but farming all his life.

Thanks.

[dyne]

I solved such problems several years ago when I REFUSED to file tax returns for farmers
or for those who need to file a schedule F.

[Gretel]

What a smart answer on April 15th.