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OWNING SURI ALPACAS:
There are essentially two ways to own alpacas. The first approach is to simply purchase the animals and start raising them. The second approach is to purchase the animals and place them in the care of an established breeder. This is referred to as Boarding or Agistment.
PURCHASE AND RAISE - Raising alpacas on your own property with hands-on, offers the farmer the best tax advantages. If the alpacas are actively raise for profit, all of the expenses attributed to the endeavor can be written off against your income.
AGISTMENT- By boarding the alpacas with an established breeder, the passive owner can enjoy some of the tax advantages such as the cost of breeding stock and expense directly relating to the maintenance of the animals.
main difference between hands-on or active farmer and a passive owner involves
the active owner's ability to deduct his investment losses against his
other income as well as income directly derived from his alpaca business.
The passive investor may only be able to deduct losses from his investment
against gain from the sale of animals and fleece. Talk to an accountant
familiar with agriculture and the section 179 depreciation schedule.
Currently, it is a tremendous benefit to ranchers and farmers of all types,
including those that raise alpacas.
FINANCING YOUR FIRST PURCHASE:
Most alpacas are sold for cash. But many buyers convert other assets to purchase their first alpacas. Some people have a line of credit for investment purposes. Others use their equity in real estate to secure funds. There are government programs and low interest specialty business loans available as well.
Some breeders offer financing for your purchase. It is typically short term (2 years) and involves paying a substantial percentage for the animals before you take possession of them (25-50 percent).
Insurance can be easily obtained while the balance is still owing and as long as you wish your investment to be protected. The seller is listed as "loss payee" on the policy until the balance is paid in full.
Connie & Rick Bodeker
6842-338th Street Way
Cannon Falls, MN 55009
Phone (507) 263-5441