It’s a familiar, nostalgic sight: every fall, the hue of Nebraska corn shifts from emerald to yellow. Those golden fields are one of the first signs of autumn, an announcement that apple cider, pumpkin pie, and brisk winds are not far away.
For many in the Nebraska Community Foundation network, incoming harvest season is also a reminder that there are many ways to give back to your community beyond a checkbook or estate plan. Over the years, generous farmers have opted to donate gifts of grain or livestock to their local NCF affiliated fund. By contributing commodities like corn or cattle, farmers and ranchers can save significantly on taxes while strengthening the mission of community.
Dan and Sarah Miller made a five-year pledge of gifts of grain to the Shickley Community Foundation Fund.
“Giving bushels of corn instead of dollars allows us to make a larger gift to our community fund, because we can still deduct all our production costs on our income taxes. It’s a really smart way to give back,” Dan said.
When the Byron Community Foundation Fund was raising money for a new community building, one of the key strategies was to bring in the agricultural community. At the time, the farm economy was exceptionally strong, and people had the capacity to give much more than in the past. The Fund leaders knew they needed to take advantage of the favorable timing for a fundraising campaign.
During its first year of operation, the Byron Community Foundation Fund received generous gifts of grain worth more than $100,000. Farmers delivered corn and soybeans to their local elevator and transferred ownership to Nebraska Community Foundation for the benefit of the Byron Community Fund. The Fund raised another $450,000 in cash and pledges in less than a year.
The late Paul and Karen Seger lived in the Atkinson area all their lives. They raised eight children there, owned and operated the funeral homes in Atkinson and Stuart, and served as volunteers and community activists.
That history will live on through the Paul and Karen Seger Family Fund. An initial gift of ag commodities (kidney beans) raised on the family farms and valued at approximately $130,000, established an endowment that will benefit community activities and organizations in Atkinson, Stuart, Antelope County and Elgin.
So how does this work? As in Byron, instead of selling the ag commodity, the producer transfers ownership of the livestock or grain directly to Nebraska Community Foundation for the benefit of their local affiliated fund. The producer can then claim all their production costs as deductible expenses for income tax purposes. When a producer transfers legal ownership to a charity before it is sold, the producer will not have taxable income from a sale, thus minimizing taxes. Tax savings may be realized on federal income tax, state income tax and self-employment tax, depending on the producer’s specific circumstances.
It is important to first check with your professional advisor to determine whether a contribution of grain or livestock is appropriate for your tax situation. It is also important that you notify Nebraska Community Foundation in advance of making your gift of commodities as there are specific (but simple) procedures that must be followed. Gift of Grain and Livestock forms are available through members of the Fund Advisory Committee.
You can also visit Nebraska Community Foundation’s Gift Planning website – www.ncfgift.org – to download the necessary forms. You can also find details on the benefits and process of making a charitable gift of grain or livestock, as well as other out-of-the-box giving methods beyond cash. Nebraska Community Foundation is also always available to point you in the right direction at (402) 323-7330 or info@nebcommfound.org.
Jeff Yost is CEO of Nebraska Community Foundation.
