Landmark Tax Bill Crosses the Finish Line

The Senate hustled early Wednesday morning, December 20 to pass the Tax Cuts and Jobs Act of 2017 by a vote of 51-48.  Although the House passed the bill Tuesday afternoon, congressional budget rules required the Senate to return the bill to the House for a revote on Wednesday to address technical changes.  While details related to the 1100-page conference report on the final legislation continue to emerge, please see the below highlights that will have the most direct impact on the horse industry:

Business Provisions

  • Corporate Taxes :  The new tax law reduces the corporate income tax rate from 35% to 21% and takes effect January 1.  AHC members filing as “C corporations,” which are generally identified by the suffix, “Inc.,” will see an immediate reduction in their official, or statutory tax rate.  AHC members filing as “C corporations” would include racetracks, makers of pharmaceuticals and agricultural equipment, and large breeding operations governed by officers and a board of directors, among others.  While many policy experts believe that the new tax code will be easier to navigate from a business perspective, corporate taxpayers’ effective liability will vary to the extent they are able to utilize the new code’s remaining deductions, some of which are outlined below.
  • Small Business, “Pass-Through” Deduction :  The Tax Cut and Jobs Act establishes a 20% deduction for the first $315,000 of joint income, or $157,500 for individual filers, from “pass-through” entities such as partnerships, sole proprietorships and S corporations.  This new provision could benefit small businesses that generally report incomes at or near the new threshold level.  While various types of “pass-throughs” constitute the fastest growing segment of AHC members, they also include the majority of U.S. farms.  According to Department of Agriculture data, 85% of domestic agriculture production comes from “pass through” entities.
  • Bonus Depreciation of Equipment: The House and Senate conference report includes 100% bonus depreciation – an increase from the current 50% rate – through December 31, 2022, for property placed in service after September 27, 2017.  Beginning in 2023, bonus depreciation is reduced from 100%, to 80% in 2024, then falls by 20% increments each year through 2026.  Farm equipment used in a business operation, breeding stock and according to a preliminary reviews of the final language, race horses will benefit from the robust deduction.
  • Losses at the Racetracks :  The final law preserves the deduction of losses “sustained … on wagering transactions to the extent of the gains” realized “during the taxable year.”  However, the law clarifies that the “limitation on losses from wagering transactions applies not only to the actual costs of the wages, but to other expenses incurred by the individual in connection with the conduct of that individual’s gambling activity.”  For example, the law subjects the deduction for travel expenses to and from a racetrack to the cap established by the amount of the gains.  Like many of the deductions in the bill, the provision sunsets after 2025.
  • Alternative Minimum Tax (AMT) – The new law repeals the corporate AMT, ending the need to calculate tax liability twice for a single filing.

Individual Provisions

  • Estate Tax:  The final law ultimately preserves the estate tax, but doubles the current exemptions of $5.49 million for individuals and $10.98 million for married couples.  Raising the statutory threshold will reduce the number of farms and family businesses subject to the tax.  It will also spare many family-run businesses from jumping over accounting hurdles to avoid the tax altogether.
  • State and Local Taxes (SALT) – The tax law includes a significantly downsized, itemized deduction for up to $10,000 of state and local property taxes.  This provision – which eliminates the unlimited, longstanding deduction for state, sales and local property taxes – may pose challenges for AHC members who file returns in high-tax states next year.
  • Mortgage Interest: The new law reduces the current $1 million cap on mortgage interest to $750,000, which the Internal Revenue Service (IRS) will apply to homes purchased after January 1, 2018.
  • Charitable Contributions:  In cases of individual cash contributions, the final law increases the percentage-limit deduction from the current rate of 50% of the donor’s adjusted gross income (AGI) to 60% of AGI.

Now the Real Work Begins

Tax policy experts predict that the fast moving tax law will result in a lengthy bill in 2018 to address technical corrections to clarify ambiguous provisions.  The Internal Revenue Service (IRS) will also begin a years-long process of promulgating regulations to implement the new law.  AHC recommends that members consult their accountants or other tax professionals to begin assessing the new tax landscape for 2018 and beyond. To view a 550-page copy of an explanation of the final conference report of the bill, please click here:  http://docs.house.gov/billsthisweek/20171218/Joint%20Explanatory%20Statement.pdf. For more information related to the new tax law and next steps, including technical corrections and implementation, please contact Bryan Brendle, Director of Policy and Legislative Affairs, at bbrendle@horsecouncil.org.

The National Reining Horse Association is not responsible for information contained in this press release. Please contact the author or submitting organization for further information, requests or questions.

New format for NRHA Futurity Collegiate Judging Contest

For Immediate Release – December 20, 2017 – Oklahoma City, Okla. – The National Reining Horse Association (NRHA) champions opportunities to develop the future of the sport of reining. One great illustration of this is the return of the Collegiate Judging Contest at the 2017 National Reining Horse Association (NRHA) Futurity & Adequan® North American Affiliate Championship Show.

The contest began with a penalty clip and rulebook test designed to measure contestants’ technical knowledge of the sport. Next, participants judged two sets of live runs during the Level 4 Open Silver Spurs Equine Semifinal. During the judging, the senior division served as scribes for the junior division and vice versa, with scribe pairs being predetermined prior to the start of the competition.

An awards breakfast at Heritage Place rounded out the competition. There, students enjoyed a Chic-Fil-A breakfast prior to the presentation of awards. Competition results are listed below. Congratulations to all participants for a great contest.


Senior Individual 
1. Mary Cornett – Mississippi State University
2. Dylan Price – Oklahoma State University
3. Rebecca Janes – Oklahoma State University
4. Kyle Vanderleest – West Texas A&M University
5. Nicole Wurzel – Oklahoma State University
6. Katy Hawkins – West Texas A&M University
7. Lyndi Starr – Texas Tech University
8. Hannah Murphy – Oklahoma State University
9. Lauren Moore West – Texas A&M University
10. Rachel Scott – Oklahoma State University


Junior Individual 
1. Tanner Robertson – NEO A&M College
2. Ashley McLaughun – NEO A&M College
3. Kayla Burns – NEO A&M College
4. Billie Tillett – Northwest College
5. Madison Edwards – Northwest College
6. Hannah Penny – North Central Texas College
7. Abby Hays – NEO A&M College
8. Kelsie Lupson – North Central Texas College
9. Katelynn Priest – Cloud County Community College
10. Hannah Jenkins – NEO A&M College


Senior Team 
1. Oklahoma State University
2. West Texas A&M University – Team White
3. West Texas A&M University – Team Maroon
4. Mississippi State University
5. University of Wyoming
6. Texas Tech University
7. Alfred University
8. Texas A&M University
9. University of Arkansas
10. University of Nebraska-Lincoln


Junior Team 
1. NEO A&M College – Team One
2. North Central Texas College – Team Red
3. Northwest College
4. NEO A&M College – Team Two
5. Cloud County Community College – Team One
6. Ellsworth Community College
7. North Central Texas College – Team Blue
8. Cloud County Community College – Team Two

Gunner Hits Second Milestone In 2017

For Immediate Release – December 19, 2017 – Oklahoma City – After reaching the nine-million-dollar mark earlier this year, NRHA Hall of Famer, the late Gunner (AQHA Colonels Smoking Gun, APHA Colonels Smokingun), has reached another milestone. At the 2017 National Reining Horse Association (NRHA) Futurity & Adequan® North American Affiliate Championship Show, he became NRHA’s second Ten Million Dollar Sire.

Bred by Eric Storey of Henegar, Ala., Gunner (Colonelfourfreckle x Katie Gun) was a stand out in the show pen. He was the 1996 NRHA Futurity Reserve Champion, 1998 National Reiners Breeders Cup Reserve Champion and 2001 USET Festival of Champions Reining Champion. During his lifetime, Gunner earned nearly $175,000.

At the 2017 Futurity, Gunner had twelve offspring competing in the finals—seven in the Open and five in the Non Pro. Together, these horses earned over $175,000 and helped Gunner become a Ten Million Dollar Sire.

Gunner’s highest money earning offspring include:

  • Tinker With Guns (out of Tinker Nic): NRHA LTE over $344,000
  • Gunners Tinseltown (out of Miss Tinseltown): NRHA LTE over $305,000
  • Americasnextgunmodel (out of Cee Dun It Do It): NRHA LTE over $289,000
  • Gunners Special Nite (out of Mifs Doll): NRHA Million Dollar Sire with NRHA LTE over $219,000
  • Gunnatrashya (out of Natrasha): NRHA Million Dollar Sire with NRHA LTE over $218,000

Congratulation to NRHA’s newest Ten Million Dollar Sire, Gunner.

Confused About the ELD Mandate? We Can Help.

On November 30th, the AHC sent out a Washington Update to our members on our efforts to address the Electronic Logging Device (ELD) Mandate. The AHC, in collaboration with the rest of the animal agriculture community, has requested that the Department of Transportation (DOT) grant a one-year enforcement delay followed by a waiver and limited exemptions from compliance with the December 18, 2017 implementation date for the Final Rule on Electronic Logging Devices (ELDs) and Hours of Service (HOS). Additionally, we requested that the DOT address the significant problems with the mandate that will occur if the compliance deadline is not extended. The welfare, safety, and health of the animals in transit, together with the safety of other drivers on the road, are top priorities for the equine industry and its enthusiasts.

The introduction of the ELD mandate has also brought to light concerns about Commercial Driver’s license (CDL) requirements from the entire equine community. Drivers have been required to have a CDL in order to drive certain commercial motor vehicles (CMV’s) since April 1, 1992. That being said, a truck and trailer can be considered a commercial vehicle without the requirement that you obtain a CDL. The AHC would like to note that the requirements for a CDL or CMV classification have been in effect for quite some time, and are not new developments along with the ELD mandate.

In an effort to help provide some clarity for both our members and the general equine industry, the AHC has put together two brochures: “Electronic Logging Device Mandate: How Will It Affect You?” and “Commercial Driver’s License: How do I Know if I Need One?” Both are available as a .pdf on the AHC’s website here: http://www.horsecouncil.org/eld-mandate-cdl-requirements/.

We encourage our members to share this information, and please contact the AHC if you have any additional questions.

READ MORE ON ELD

The National Reining Horse Association is not responsible for information contained in this press release. Please contact the author or submitting organization for further information, requests or questions.

NRHA Has a New Million Dollar Owner

For Immediate Release – December 15, 2017 – Oklahoma City – Many historic milestones were crossed at the 2017 National Reining Horse Association (NRHA) Futurity & Adequan® North American Affiliate Championship Show. Adding to the list of accomplishments was Silver Spurs Equine. During the Lucas Oil Level 4 Open Futurity final, Silver Spurs Equine crossed the mark as an NRHA Million Dollar Owner.

A vast majority of Silver Spurs Equine’s success began with their vision for improving the industry. Beginning with the world famous Boomernic (Reminic x Docs Leavem Smoke), the ranch founded an elite breeding program that features some of the top stallions in the equine world. The success continued as Silver Spurs Equine bred, purchased and sent horses to top level shows. Notable finishes include 2017 NRHA Derby Level 3 Open Champion, Ruf Lil Magnum (Magnum Chic Dream x Dunit A Lil Ruf), and 2016 NRHA Derby Level 4 Open Reserve Co-Champion, Platinum Vintage (A Sparkling Vintage x Starjac Miss).

During the 2017 NRHA Futurity, Silver Spurs Equine had two horses competing in the Level 4 Open Finals. During the event, the ranch earned more than $78,000 with runs made by the following horses:

  • Xtra Dun Step Xtra Dun Step (Wimpys Little Step x All Thats Dun) ridden by Trevor Dare placing third in the Level 4 Open division
  • Xtra Gotta Step (Wimpys Little Step x Gotta Git Ya Dun) ridden by Jordan Larson in the Level 4 Open division

Congratulations to NRHA’s newest Million Dollar Owner, Silver Spurs Equine.