Republicans and President Obama seem to be in a deadlock regarding the Estate Tax – and if bipartisanship on the issue continues to lack – some of America’s family farms could experience a major tax increase. Senate Finance Chair Max Baucus wants to preserve reductions in estate taxes and provide an economic cushion to family farms and ranches planning to pass their property from generation to generation. The current Estate Tax rate is 35-percent on estates over 5-million dollars. If Congress doesn’t act – the rate will increase to 55-percent with a 1-million dollar exemption.
One in 10 families are estimated to pay the Estate Tax in the coming year if exemption levels go untouched by Congress – many seen as asset-rich and cash-poor. Currently 96-percent of American farms and ranches are family-owned and operated – but less than 50 family farms and ranches had to pay the tax in 2011. If the 2009 Estate Tax levels are reinstated – 75-hundred estates would be required to pay the tax – compared to 36-hundred estates at current levels.
source: NAFB News Service