You do not need an agricultural degree or even a history of working with livestock to succeed with alpacas. We at Hairloom Alpacas have a lifetime of experience working with livestock as a second business and have found alpacas to be self-rewarding as well as a financially sound investment. Hairloom Alpacas is dedicated to helping you
succeed at profiting with alpacas whether you are young and desire to build a profitable business or, like us, you are pre-retirement and want to stay active and have lucrative "golden years".
Once you have made the decision to invest in our alpacas there are a few financial things you need to know.
First and foremost, you and the IRS must agree that your alpaca farm is a business and not a hobby. A hobby is considered a venture that doesn’t make money. A business makes money. There are different ways of setting up your business, with a Sole Proprietorship being the simplest and most common. Itemized deductions are taken on a schedule F (farm schedule) and filed with your Form 1040. However, you may also form a Corporation, S-Corporation, Partnership, or LLC, which you would want an attorney to help you set up.
A sound Business Plan is a must, which should include your goals for that time period, the amount of your investment, and what your return should be in that length of time. Your return should increase with each additional year.
Next, there are deductions, which are a pay increase in themselves. Alpaca tax benefits are one of the many reasons to own these beautiful creatures. Savings in taxes will pay for many of your alpaca farm expenses. You may claim deductions such as: feed, hired labor, vehicle expenses and/or mileage for farm use, utility expenses, building/maintenance costs, cost of the animals, breeding, shearing and vet fees, agisting of your alpacas on another alpaca farm, travel expenses related to your alpacas, and even your accounting fees, just to name a few. Hairloom Alpacas has a complete outline of deductions we would be happy to share with you.
Income from alpacas, or returns on your investment, comes in many forms. Selling your offspring, breeding fees from your herdsires, agisting outside alpacas, sales of raw fleece and yarn, or a farm store to sell finished alpaca products. The alpaca industry is on the brink of a fiber avalanche. Foreign markets are competing for America’s alpaca fiber, and the profits to be gained from selling your alpaca fiber should increase, also.
Life is not a destination – it is a journey to be enjoyed as we travel. If you love animals and want a legacy to leave for your children and grandchildren without all the stress of a 9-5 job, then alpacas are your other stock option.