A group comprised from the commodity, dairy, livestock and specialty crop industries in urging the House and Senate to enact legislation before the end of the year to provide permanent and meaningful estate tax relief. The group supports permanently keeping the current exemption at $5 million per person and retaining the top rate of 35%.
The American Soybean Association (ASA), that is a part of the group, believes it is also imperative that the permanent estate tax law index the exemption to inflation, provide for spousal transfers, and include the stepped-up basis.
If Congress does not take action on ASA’s recommendations before the end of the year, the exemption will drop to $1 million and the top tax rate above the exclusion amount will increase to 55%.
“If estate taxes are allowed to be reinstated at the beginning of 2013 with only a $1 million exemption and top rate of 55%, the negative impact on our industry will be significant,” stated the groups. “The 2013 change to the estate tax law does a disservice to agriculture because we are a land-based, capital-intensive industry with few options for paying estate taxes when they come due. The current state of our economy, coupled with the uncertain nature of estate tax liabilities, makes it difficult for family-owned farms and ranches to make sound business decisions.”
In letters to both chambers Friday, ASA encouraged Congress to show its support for “permanent and meaningful estate tax relief” with the co-sponsorship of bills reforming the estate tax. In the House, Rep. Kevin Brady (R-Texas) has introduced the Death Tax Repeal Permanency Act (H.R. 1259), while Sen. John Thune (R-S.D.) has advanced the counterpart Senate bill of the same name (S. 2242).
“This action will strengthen the business climate for farm and ranch families while ensuring agricultural businesses can be passed to future generations,” continued the groups. “Allowing estate taxes to be reinstated without an exemption and rate that protects family farms puts many operations at risk and threatens succession to the next generation of farmers.”