Sch F

[DTS]

I am preparing my first Sch F for a partnership and need some answers to a few questions. This is the first year for this business, raising alpacas for fiber.

1) Do all expenses related to this activity have to go on F or can they be be put on the 1065 where there is a more appropriate catagory, also?

2) What is the business code for "animal fiber"? I have 112900.

3) What is depreciation for alpacas? There is nothing specific I can see.

I will have a few more questions later, but this should be a good start.

Thank you,
Dennis

[JG EA]

I'll answer number 1

Yes, you can put expenses on page one of the partnership return (or on other deductions) if those expenses relate to the partnership in general and not to the farm specifically.

[Bucky]

Fiber sales? You have to sell a lot of fiber to pay for a $15000 animal. They are cute little fellas. I have several clients that have alpaca farms. Two are partnerships. 5 years depr on the purchased alpacas. Most everything needs to go on the schedule F. Not sure what you would have that wouldn't. Most people making any money are breeding and selling young or building a herd and selling off animals. There really isn't a market for the fiber. How many alpaca coats, shirts blankets or rugs do you have? I think a lot of people are going to end up with some very expensive pets. Keep track of basis for each partner because they won't have a clue and your going to have big loses for several years.

[DTS]

Alpacas

JG & Bucky,

Thank you for the help. Some of the items I see so far will go on F, but I did not know if I should put other items, not specific, in "other expenses" or find a field on the 1065.

I am not looking forward to this venture! She asked me what I thought and I told her. She did not ask again. I see one gigantic money pit. They are trying to build a large herd and will breed them to sell and shear. From what I can gather, any money coming in will be small and not often.

Do I have the right take on this?

Dennis

[Gretel]

Do I have the right take on this?

Dennis

You have the right to take on anything you decide to do. The real question is: Do you WANT to take it on, already not looking forward to it?