Ag Groups Call for Repeal of Estate Tax
March 31, 2017
The American Sheep Industry Association joined other agriculture groups in a letter urging House Committee on Ways and Means leaders to include an estate tax repeal in any tax reform legislation they consider this year.
“The estate tax is especially damaging to agriculture because of it being a land-based, capital-intensive industry with few options for paying estate taxes when they come due,” 32 agriculture organizations wrote.
The groups also asked lawmakers to ensure the benefits of estate tax repeal are not eroded by the elimination of or restrictions to the use of the stepped-up basis.
“Because farmland is typically held by one owner for several decades, setting the basis on the value of the farm on the date of the owner’s death under stepped-up basis is an important tax provision for surviving family members,” the letter stated.
The American Taxpayer Relief Act of 2012 permanently extended the estate tax exemption level to $5 million per person/$10 million per couple indexed for inflation, and maintained stepped-up basis, but the current economy, combined with the uncertain nature of agricultural production has left many farmers and ranchers guessing about their ability to plan for estate tax liabilities and unable to make prudent business decisions, the letter noted.
“Until the estate tax is fully repealed it will continue to threaten the economic viability of family farms and ranches, as well as the rural communities and businesses that agriculture supports,” the groups wrote.