Giving gifts of grains through the community foundation can reduce taxes for area farmers.

Grinnell, IA, January 12th : Farmers wanting to contribute to good causes through the Greater Poweshiek Community Foundation (GPCF)  have the option to give bushels of grain through the gifting of grain program.

“You can donate grain for any charity and this is a common practice amongst churches. In the past, we had one farmer who has gifted grains to our foundation and it is a relatively simple process.  With recent spikes in commodity prices we were getting more inquiries regarding gifting grains to the community foundation and it seems appropriate to share this wonderful opportunity with our farming community,” said GPCF Gift Planning Coordinator, Delphina Baumann.

Baumann said the grain gift program was developed with the help of Tim Baker, a local certified public accountant and Heidi Pearson, GPCF Program Assistant and VISTA Americorps Volunteer.  Heidi has been working to increase the endowment at the GPCF and to find ways to engage different members of our community.  According to Pearson, "we wanted to have a fully developed framework in place to accept the gifts of grains since this is a great way for farmers to give back to their communities while reducing their tax burden.”

Gifting grains is better than writing a check to your favorite charity because there are significant tax benefits of gifting grain instead of cash. This is because donated grain is not recorded as income but as cash basis and a farmer can still deduct the cost of growing the crop which results in saving self employment tax, federal income tax and state income tax. Furthermore, farmers can donate grains grown this year or in the previous year’s harvest.  

Baker said “the first step is for people to contact their tax advisers to make sure grain contributions are appropriate for individual tax situations. Then, they should advise the GPCF staff of the planned gifts so that they follow the steps necessary to make sure the gifting is executed properly.”  

Several critical steps must be taken when grain is delivered to an elevator. First, a storage receipt must be issued in the name of the Greater Poweshiek Community Foundation as evidence that grain ownership was transferred from the producer to the foundation.  Second, a contract to sell the grain must be sent to the foundation for a signature.  The contract can be mailed or faxed.  Third, since GPCF owns the grain, producers should not instruct the elevator to sell it. Finally, when the foundation sells the grain on the spot market, which is the policy, the elevator staff must issue the check to GPCF.

According to Baker, “the grain gift isn't a tax deduction, the producer benefit comes from the fact that the unsold grain is gifted and doesn't become taxable income.”

“It's just another option to give back to the community or to causes that matter the most to you, and it's also an excellent way to give and remain anonymous," said Baumann.   Gifts of grain given through the foundation can be designated for one or more local causes. There are more than 80 funds at the 23-year-old foundation and a donor can even set up a new designated fund with a gift of $10,000 or more.

The Greater Poweshiek Community Foundation is a non-profit organization that assists donors in efficiently and effectively supporting other charitable organizations that make life better for people in the area. Through the Foundation, donors are able to make long-lasting positive contributions without being burdened by administrative or legal complexities.  A Gift of Grain brochure is available for anyone seeking more information and it includes a Gift of Grain donation form on which the type of grain and bushels being donated are identified, and the steps to follow.  For more information on the Greater Poweshiek Community Foundation or the gifting of grains please visit the website at www.greaterpcf.org or call Delphina or Heidi at 641-236-5518.

Click here to download our Gift of Grain Brochure/Donation Form.