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Gifts of Grain to Culbertson Memorial Hospital Foundation

CMH Foundation Director Tim Ward signing up Dusty Farms owner Jerry Ward to gift grain to the CMH Foundation.

The Culbertson Memorial Hospital (CMH Foundation) is encouraging farmers to consider gifts of grain this harvest season. These gifts can be in the form of grain just harvested or grain taken from storage and delivered to the elevator.

There are several distinct advantages for donors to use grain when making a list to charity instead of contributing cash, says CMH Foundation Director Tim Ward. Foremost among these is the fact that the commodity (corn, beans, etc.) becomes an asset of the charity, and when it is sold the value of the grain contributed is not reported as income by the farmer. Typically, the farmer will still be allowed to claim his deduction for the costs of production of the gifted commodity as a farm business expense. This gifting method allows the farmer to reduce his federal income tax, self-employment tax and state income tax. This makes the charitable gift of grain, which reduces their taxable income, a win-win situation for both CMH Foundation and the donor.

Ward recommends you take the following steps if you are contributing grain to CMH Foundation. However, you should always consult your tax professional for advice pertaining to your personal tax situation prior to making a charitable contribution of grain.

  1. Fulfill any agricultural subsidy program obligations prior to their donation (LDPs, etc.).
  2. To receive the most favorable tax results, the grain must be designated as belonging to CMH Foundation prior to the grain crossing the scales and/or the grain being dumped. Prior to the weighing or dumping, the farmer should inform the elevator as follows:
    • “this load belongs to CMH Foundation”
    • “a portion of this load belongs to CMH Foundation” (then specifying exactly what that portion will be: 1/2, 1/3, etc.)
    • “______ bushels of this load belong to CMH Foundation.”
  3. You must give up “dominion and control” of the commodity. The CMH Foundation will be responsible for any subsequent risk and charges (drying, shrink, etc.) and will market the commodity as soon as it is received.
  4. You should call Foundation Director Tim Ward at 217-248-7511 to notify the CMH Foundation that you will be making or have made a contribution of grain. This information should include the description of the commodity and the quantity being contributed. If you have a separate farming entity - such as a corporation or LLC, that actually produces the commodity, we need to know that as well, so the documentation for the contribution can be completed correctly.

After we have been notified of the contribution, CMH Foundation will then authorize the sale of the grain and collect the proceeds from that sale. Upon receipt of the proceeds for the grain, CMH Foundation will send you a letter confirming the date of the donation, description, quantity and selling price of the donated commodity, its total value and how the gift was designated. Lynn Stambaugh, CEO of Culbertson Memorial Hospital, said that the Gifting Program will help more patients, expand facilities, acquire cutting-edge equipment and help attract top medical professionals. Your contribution will remain in our community to benefit you, your family and your neighbors.

Farmers gifting grain should utilize the CMH Foundation form to designate a charitable gift of commodities. If the elevator of the farmer’s choice does not have the Foundation form, please call Tim Ward at 217-248-7511 to request the grain transfer form.

The material presented on this Planned Giving website is not offered as legal or tax advice.
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