Impact of Milk Income Loss Contract (MILC) and Section 179 Expensing on Rates of Return for Alternative Dairy Systems

The impact of the Milk Income Loss Contract (MILC) and Section 179 expensing on internal rate of returns (IRR) for three dairy systems, a 120-cow grazing, a 120-cow conventional, and 600-cow concentrated was evaluated. With MILC, the grazing and conventional systems had higher IRRs. Without MILC, the 600- cow dairy had the highest IRR. Without Sec. 179, IRRs declined proportionally more for grazing and conventional systems.