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
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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