About Farm Credit of Ness City Patronage Program
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Part of the Farm Credit System
Patronage Payment Program
What is our patronage?
Each year, our Board determines an amount of money to return to our owner/members based on our earnings for the year. This is paid in cash and is determined from the amount of interest you paid to Farm Credit of Ness City, FLCA during the calendar year prior to the year you receive your check.
Sharing Profits with Owners (our Borrowers)
|
YEAR |
TOTAL CAPITAL RETURNED |
% OF INTEREST PAID RETURNED TO MEMBER |
| 2000 | $500,000.00 | |
| 2001 | $660,000.00 | |
| 2002 | $684,036.27 | |
| 2003 | $755,000.00 | |
| 2004 | $840,000.00 | |
| 2005 | $1,239333.00 | |
| 2006 | $1,500,000.00 | |
| 2007 | $1,500,000.00 | 16.77% |
| 2008 | $1,700,000.00 | 16.99% |
| 2009 | $1,700,000.00 | 18.73% |
| TOTAL | $11,078,369.27 |
This table shows the patronage paid to our customers over the past seven years.
Who is eligible?
If you paid interest to the Association during the calendar year, your loan will receive a cash patronage payment, unless you negotiated a lower rate and waived your right to receive patronage.
When do you receive it?
Checks are mailed or personally delivered each November.
How does this effectively reduce your interest paid?
This is easy. For example, in 2009 we returned to members 18.73% of the interest they paid during the prior calendar year. If your loan had a rate of 7.00%, this would effectively reduce your rate by 1.31%. Example: (7.0% x .1873 = 1.31%, or 7.00% - 1.31% = 5.69%.)
Is the cash cash patronage payment taxable?
Yes. The cash patronage refund is taxable and should be included in the taxable income for the year in which it is received. We encourage you to consult with your tax advisor about your specific situation. Customers will receive an IRS Form 1099-PATR along with the check when it is distributed.
Will we continue to pay patronage?
Our Board of Directors believes that the patronage program is an important part of the Association’s benefits to its borrowers/stockholders. Future patronage payments will be based on the continued profitability and financial strength of the Association.
Who should I contact if I have questions about the patronage program?
Your loan officer understands the patronage program and will be able to answer questions you may have about the patronage program.