Common use of Tax Considerations in Leasing Land Clause in Contracts

Tax Considerations in Leasing Land. Farmers who rent land to persons other than a spouse or child may not qualify for the capital gain rollover when land is transferred to a child. A custom farming arrangement could be used. Consult a tax professional before taking action in this area. Rental income earned by a landlord can be included as earnings in calculating the maximum allowable RRSP contribution, and in calculating Canada Pension Plan (CPP) contributions. A bargain purchase option exercised at a price significantly lower than the fair market value at the end of the lease can create an unexpected tax liability. An accountant or farm management advisor should be consulted before entering into any custom farming arrangement or lease which contains a bargain purchase option.

Tax Considerations in Leasing Land.  Farmers who rent land to persons other than a spouse or child may not qualify for the capital gain rollover when land is transferred to a child. A custom farming arrangement could be used. Consult a tax professional before taking action in this area.  Rental income earned by a landlord can be included as earnings in calculating the maximum allowable RRSP contribution, and in calculating Canada Pension Plan (CPP) contributions. A bargain purchase option exercised at a price significantly lower than the fair market value at the end of the lease can create an unexpected tax liability. An accountant or farm management advisor should be consulted before entering into any custom farming arrangement or lease which contains a bargain purchase option.

Tax Considerations in Leasing Land. Farmers who rent land to persons other than a spouse or child may not qualify for the capital gain rollover when land is transferred to a child. A custom farming arrangement could be used. Consult a tax professional before taking action in this area. • Rental income earned by a landlord can be included as earnings in calculating the maximum allowable RRSP contribution, and in calculating Canada Pension Plan (CPP) contributions. A bargain purchase option exercised at a price significantly lower than the fair market value at the end of the lease can create an unexpected tax liability. An accountant or farm management advisor should be consulted before entering into any custom farming arrangement or lease which contains a bargain purchase option.

Tax Considerations in Leasing Land. Farmers who rent land to persons other than a spouse or child may not qualify for the capital gain rollover when land is transferred to a child. A custom farming arrangement could be used. Consult a tax professional before taking action in this area. • Rental income earned by a landlord can be included as earnings in calculating the maximum allowable RRSP contribution, and in calculating Canada Pension Plan (CPP) contributions. A bargain purchase option exercised at a price significantly lower than the fair market value at the end of the lease can create an unexpected tax liability. An accountant or farm management advisor specialist should be consulted before entering into any custom farming arrangement or lease which contains a bargain purchase option.