As Congress tries to create a comprehensive tax reform bill, farmers and ranchers need to come together to make sure their voices are heard. In an interview with the American Farm Bureau Federation, Pat Wolff, an agricultural tax policy specialist, explains current progress and outlines the further policy revisions needed.
Farmers and ranchers have already benefited from the estate tax reform. The last-minute reform passed through Congress after the fiscal cliff almost reset the estate tax to its underwhelming 2001 provisions.
Under the revised bill, people who inherit farm or ranch land worth under $5 million are exempt from paying an estate tax on the property. Any property over this amount is subjected a tax cap set at 40 percent.
While Wolff calls this bill a “big success,” she believes further work on the bill is necessary.
“Even though we have a higher exemption it’s not high enough to take care of all farms and ranchers and with the way that farmland values are increasing, that extension becomes less and less valuable,” she explains.
Congress is taking a summer recess in August before the tax bill is expected to be drafted in September. All senators have been asked to submit a letter to the chairman of the tax-writing committee outlining their priorities for the reform. Wolff recommends farmers and ranchers visit their members of Congress so their concerns can be represented and addressed in the upcoming revisions.