What I've been breeding towards

[Stocker Steve]

Open Jersey heifers are $300 to $500 here. Should I be buying them and breeding them Brahma ?

 

[Stocker Steve]

My heifers don't die, unless I put them in the freezer. :hat: Got one high headed bitch going next week.

I think the tax angle for high income CT guys like us is to buy heifers, run them on leased pasture for a couple years, then sell them "paying" a 0% capital gains tax rate. Are you in on this CB?

 

[Nesikep]

Don't know your specific tax laws, but around here's it's exactly the same of you keep a replacement or sell your heifers and buy replacements

If you sell the heifer, that's income they for the year she's sold.. if you buy the heifer, that's an expense the year she's bought, so if you sell and buy another one for the same price, the same year, you're not better off.

If the purchased one falls over dead, it doesn't matter, you've already written her off when you bought her and can't be expensed twice.. if the kept replacement falls over dead, she was never income, so she can't be expensed. Feed, salt, and the other cash costs are all expenses you can write off regardless.

 

[Caustic Burno]

Don't know your specific tax laws, but around here's it's exactly the same of you keep a replacement or sell your heifers and buy replacements

If you sell the heifer, that's income they for the year she's sold.. if you buy the heifer, that's an expense the year she's bought, so if you sell and buy another one for the same price, the same year, you're not better off.

If the purchased one falls over dead, it doesn't matter, you've already written her off when you bought her and can't be expensed twice.. if the kept replacement falls over dead, she was never income, so she can't be expensed. Feed, salt, and the other cash costs are all expenses you can write off regardless.

You can deprecate the cost of the bought heifer and write off inputs.
The inputs are higher on the retained heifer versus the cost of purchasing a heifer.
You have two years in the heifer with no return to the operation as well as the dam. The dam cost 1100 bucks for two years at 1.50 a day and never returned a penny for two years. From weaning of the heifer until calving you have 800 in her at 1.50 a day so your retained heifer is costing right a 2k and nothing returned to the operation.
Retaining is fine just don't sugarcoat the cost.

 

[Stocker Steve]

Buying replacements is fine just don't over state the cost of retaining in current market:

500 x $1.30 is $650 for a retained heifer.
Costs will vary but $1/day should easily feed a small one in cow country.
So 650 + 365 is U$S 1,015 to become a basic bred heifer. Add in vet and breeding and interest costs gets you up to about $ 1,100. Opens are sold for a premium as freezer beef. OH varies but you could add $100.

Yes, I can buy a bred heifer for less than $1,200 if I shop around and I am willing to sort.

 

[Brute 23]

Don't know your specific tax laws, but around here's it's exactly the same of you keep a replacement or sell your heifers and buy replacements

If you sell the heifer, that's income they for the year she's sold.. if you buy the heifer, that's an expense the year she's bought, so if you sell and buy another one for the same price, the same year, you're not better off.

If the purchased one falls over dead, it doesn't matter, you've already written her off when you bought her and can't be expensed twice.. if the kept replacement falls over dead, she was never income, so she can't be expensed. Feed, salt, and the other cash costs are all expenses you can write off regardless.

Exactly... it's a wash. By the time you pay for the income on the sold calf, even with depreciation on the bought your equaling out. Plus, dont forget if you sell the animal for more than the depreciated value it's still taxable.

Actually there is a strong case to be made retaining because you can defer the taxes from selling that calf and grow your asset base much like a tax sheltered retirement plan.

It costs us, on avg $350 per momma cow to raise a calf, annually. Some will say that is too low but it's done by feeding less than 1 bale per head per year. One of the perks of a mild winter in the south.

So you take $350 for the cost to raise that calf to weaning. Now, you did not generate income by selling her so that is another cost. Pick a number, I'll go $650... at $1000 total. Let's say you wean at 7 months, breed at 16 months, you got 9 months on the dole. 9 x 30.4 = 273.6 days @ $1 per day... another $275. Now I'm at $1275. That replacement heifer's bill ends the day she is bred. Once she is bred her costs now go against her calf, not retaining a heifer costs. She is just like any other cow in the herd once she is bred.

Even if you factor a group not calving out 100% and some misc if you think some of my costs were low... from the pics I posted of cattle... does any one here think they can buy that quality of animals, consistently cheaper, year in, year out?

If you can let me know... I'll bring the check book and make sure there is even a finders fee in there for you.

I can tell you it darn sure wont be from from no cattle peddlers like J&J, Clay Nahovitza, or any of the other FB personalities.

 

[ALACOWMAN]

their sire..

Who's the daddy of that bull?

 

[TennesseeTuxedo]

their sire..

Who's the daddy of that bull?

Been a long time since we argued about bulls standing in tall grass or deep straw.

 

[TennesseeTuxedo]

He looks terrific though.

 

[Caustic Burno]

Don't know your specific tax laws, but around here's it's exactly the same of you keep a replacement or sell your heifers and buy replacements

If you sell the heifer, that's income they for the year she's sold.. if you buy the heifer, that's an expense the year she's bought, so if you sell and buy another one for the same price, the same year, you're not better off.

If the purchased one falls over dead, it doesn't matter, you've already written her off when you bought her and can't be expensed twice.. if the kept replacement falls over dead, she was never income, so she can't be expensed. Feed, salt, and the other cash costs are all expenses you can write off regardless.

Exactly... it's a wash. By the time you pay for the income on the sold calf, even with depreciation on the bought your equaling out. Plus, dont forget if you sell the animal for more than the depreciated value it's still taxable.

Actually there is a strong case to be made retaining because you can defer the taxes from selling that calf and grow your asset base much like a tax sheltered retirement plan.

It costs us, on avg $350 per momma cow to raise a calf, annually. Some will say that is too low but it's done by feeding less than 1 bale per head per year. One of the perks of a mild winter in the south.

So you take $350 for the cost to raise that calf to weaning. Now, you did not generate income by selling her so that is another cost. Pick a number, I'll go $650... at $1000 total. Let's say you wean at 7 months, breed at 16 months, you got 9 months on the dole. 9 x 30.4 = 273.6 days @ $1 per day... another $275. Now I'm at $1275. That replacement heifer's bill ends the day she is bred. Once she is bred her costs now go against her calf, not retaining a heifer costs. She is just like any other cow in the herd once she is bred.

Even if you factor a group not calving out 100% and some misc if you think some of my costs were low... from the pics I posted of cattle... does any one here think they can buy that quality of animals, consistently cheaper, year in, year out?

If you can let me know... I'll bring the check book and make sure there is even a finders fee in there for you.

I can tell you it darn sure wont be from from no cattle peddlers like J&J, Clay Nahovitza, or any of the other FB personalities.

I have not bought anything from the young men at J&J it looks to me we should be trying more so to emulate them versus envy.
They have an impressive marketing model along with internet auction.
They peddle as you say heifers, cows and bulls. Isn't that the exact same thing the seed stock producer and the auction barn is doing? Aren't you a cow peddler?
With today's margins looks to me from the outside looking in they found a more efficient mousetrap.

There is no advantage to retaining heifers in a crossbred cow calf operation using a terminal bull.
The only benefits to retaining is genetic improvement.
You better sharpen that pencil that dam returned nothing nor the heifer to the bottom line for two years.
You have four years worth of upkeep in two cows, with today's margins that doesn't pencil out.

 

[ALACOWMAN]

He looks terrific though.

I seen him in a dry paddock..he looks just as good or better in person ..I got pictures saved on a old digital camera of it..

 

[Caustic Burno]

He looks terrific though.

I seen him in a dry paddock..he looks just as good or better in person ..I got pictures saved on a old digital camera of it..

That's a good looking bull for a black one.

 

[TennesseeTuxedo]

He looks terrific though.

I seen him in a dry paddock..he looks just as good or better in person ..I got pictures saved on a old digital camera of it..

I like him a lot. The picture just got me to thinking about some of those old fights we used to have.

 

[Brute 23]

That is not true. That cow produced an asset, a revenue generating asset. Your net worth went up by retaining that heifer. That is not nothing.

If you will do an actual balance sheet you can see that it's not all about cash flow. It's like reinvesting the dividends from your stocks to buy more stock.

 

[Brute 23]

... and you increased that net worth tax free! That pencils put for me ALL DAY LONG. :tiphat:

 

[Caustic Burno]

That is not true. That cow produced an asset, a revenue generating asset. Your net worth went up by retaining that heifer. That is not nothing.

If you will do an actual balance sheet you can see that it's not all about cash flow. It's like reinvesting the dividends from your stocks to buy more stock.

The only person your fooling is yourself.
Brute the retained heifer has no value unless sold. She is not a revenue generating asset for two years . She is a liability until she produces a live calf to sell. Of course they all have 100% live salable calves. Now if she craps out. Now if you cull her she is a profit to be taxed. You have more assets not more net worth unless your bank account increases. Neither are generating income for two years that's a liability. Your business model using Wall Street is buy high sell low.
You can add a 100 cows if they are not producing that's a a liability not an asset till sold. That's money outflows not in.

 

[Brute 23]

No sir, that is not true.

I pled my case. Every one reading along can decide for themselves how they want to do it in their operation. Good day. :tiphat:

 

[Caustic Burno]

No sir, that is not true.

I pled my case. Every one reading along can decide for themselves how they want to do it in their operation. Good day. :tiphat:

Brute if they were a generating asset the IRS would be taxing them not letting you write off the liability.
Again they are only an asset when sold.
Have a nice evening.

 

[Nesikep]

No sir, that is not true.

I pled my case. Every one reading along can decide for themselves how they want to do it in their operation. Good day. :tiphat:

Brute if they were a generating asset the IRS would be taxing them not letting you write off the liability.
Again they are only an asset when sold.
Have a nice evening.

Assets aren't taxed, income is
So that retained heifer is gaining in value as she becomes a cow (hopefully)

The only way you're getting ahead is if you sell heifer calves to buy bred heifers, but you're probably going to have to put additional money in the pot to get them

 

[gcreekrch]

He looks terrific though.

I seen him in a dry paddock..he looks just as good or better in person ..I got pictures saved on a old digital camera of it..

If I had built cattle like that heifer I would not care one iota about whether she was a better tax write off or not. Those kind make money not tax dodges.