As talk about taxes picks up in Washington, D.C., agriculture is watching.
Since his time on the campaign trail, President Joe Biden has been talking about potential tax changes and now discussions are ramping up, as are concerns from the nation’s farm community.
There have been recent proposals by several lawmakers to tax unrealized capital gains at death and roll back the stepped-up basis on those capital gains.
“Taxing capital gains when a loved one passes away would have a devastating impact on farm and ranch families, even more so if the stepped-up basis tool is taken out of the toolbox. Stepped-up basis encourages families to grow their businesses and pass them on to another generation, and elimination could force those families to sell their farms just to pay the taxes,” said Zippy Duvall, American Farm Bureau Federation president. “The value of many farms is tied up in land and equipment. Cash flow on most farms is much too small to pay large capital gains taxes. These taxes would cause further consolidation in agriculture with small farms more likely to be forced out of business by the tax liability.
“I’m confident that’s not what Congress intends. AFBF urges lawmakers to discard these misguided proposals.”