Now that the debt deal is done, is tax reform next on the political agenda? Don’t be surprised if it is, say some in the tax field.

Under the terms of the debt ceiling budget deal, Congress must pass another $1.5 trillion in deficit reduction by the end of this year or face pre-agreed upon automatic spending cuts, according to a report in AdvisorOne.

“A newly released briefing by tax software provider CCH predicts sweeping tax reform legislation the likes of which have not been seen since the 1986 tax reform. In its analysis of recent legislative and tax proposals by Republicans and Democrats, the White House and a bipartisan deficit commission, the Illinois-based tax, accounting and audit information provider argues that fundamental changes in the nation’s tax law may be the only way to bridge the divide between Republicans who want to cut taxes and Democrats seeking to raise revenue,” authors note.

The briefing was released last week and says that “Changes made under the general banner of tax reform can have the advantage of gaining support from both ends of the political spectrum. The result is likely to be a heavy emphasis on reducing or eliminating so-called “tax expenditures,” essentially deductions, credits and other tax benefits written into the tax code.

These tools, and any changes to them, are of critical interest to dairy farmers and other ag operations. But, don’t get the cart ahead of the horse with regard to potential sweeping tax reforms, note other industry experts.

“Frankly, my view is that next to nothing significant will get done by the current Congress and adminstration,” says Roger McEowen, director of Iowa State University’s Center for Agricultural Law and Taxation. “Does something major need to be done? Absolutely. This problem has been building for decades.”

However, he does not expect that a pro-growth policy will be enacted anytime soon. Instead, he predicts more economic challenges ahead, including rising interest rates, high unemployment, weakness in the stock market and inflation.

To cope, McEowen suggests that “Land has always been a good hedge against inflation, along with commodities. But, those with debt will get hammered,” he says.