The American Farm Bureau Federation, along with 46 state Farm Bureaus and 280 organizations representing family-owned agribusinesses, sent a letter today to congressional leaders urging them to leave important tax policies in place as they draft legislation implementing President Biden’s “Build Back Better” agenda. The letter addresses four key tax provisions that make it possible for farmers and ranchers to survive and pass their businesses on to the next generation: estate taxes, stepped-up basis, 199A small business deduction and like-kind exchanges.
“The policies Congress enacts now will determine agricultural producers’ ability to secure affordable land to start or expand their operations,” the letter states. “Regardless of whether a business has already been passed down through multiple generations or is just starting out, the key to their longevity is a continued ability to transition when a family member or business partner dies. For this reason, we firmly believe the current federal estate tax code provisions must be maintained.”
These tools are as crucial as ever as the number of farmers and ranchers 65 and older outnumber those 35 and under by a four-to-one margin. More than 370 million acres are expected to change hands in the next two decades.
“As the economic backbone of nearly every county and rural community across the U.S., the importance of American agriculture and related industries cannot be overlooked,” the letter continues. “Farmers, ranchers, and family-owned agribusiness operators are responsible for producing the safe, affordable, and abundant food, fiber, and fuel supplies Americans enjoy every day. As the stewards of nearly 900 million acres of crop and rangeland, farmers and ranchers play an important role in terms of natural resource and land conservation. For agricultural producers, carrying on the legacy of our predecessors and setting the next generation up for success is critically important.”