Client bought five beef on the hoof in Apr 04. Put them on daddy's farm to fatten up. Sold them in Nov 04. Can't put them on Schedule F 'cause she aint no farmer. I put them on Schedule D, called them personal property, and she claimed a capital gain. She had no expenses. Any thoughts on this or how you might have handled these depreciable assets. Transactions of this nature on Schedule F usually call for an SE to be filed. Ric Smith, EA Dunlap TN TN Walking Horse Country
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The only time cattle are depreciable is if they are breeding livestock. Now if they were steers, I have answered your question. Putting these one shot animals on schedule D is about right. But they are inventory, not capital assets, and they should go on 4797 if not on the schedule F.
-- Frederick E. Jorden
First question is how are these five beeves depreciable property? Since they are fatted cattle, they're not breeding stock, to which depreciation might apply. Capital assets? I think not. So.. where..... Ah; line 21, that's always a good place.
Anyway, even if on schedule d, the gain would be short term anyway, just like ordinary income. ChEAr$, Harlan Lunsford, EA n LA, borders on UA, which borders on TN, also known as Bourbon country Sun 27 mar 2005
Schedule F unless the livestock was held for draft, breeding, sport, or dairy purposes.
-- Alan
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