Tax Reform Concerns Offered to Finance Committee
June 7, 2013
The American Sheep Industry Association joined more than 20 other national agriculture groups in sending a letter to the leadership of the Senate Committee on Finance offering comments on tax reform issues of concern to farmers and ranchers.
For many farmers and ranchers, the appraised value of rural land is inflated when compared to its agricultural value. Many operations are able to utilize the Special Use Valuation (Section 2032A) giving owners the ability to reduce their estate taxes by allowing a limited amount of business property to be valued for its actual use rather than for its highest value use (up to $1 million) for estate tax purposes. The letter recommended that there be no limitation on the amount that property values can be reduced.
The committee's draft proposes setting the Section 179 Small Business Expensing limit at $250,000, which would be reduced dollar-for-dollar when expenses exceed $800,000 indexed for inflation. The signators to the letter support maintaining the current $500,000 Section 179 small business expensing limitation and the $2 million acquisition limit.
The letter also encourages a permanent five-year depreciation schedule for agricultural equipment.