The American Farm Bureau Federation praised the U.S. House of Representatives for its April 16 passage of the Death Tax Repeal Act of 2015 and is encouraging the Senate to pass the bill as well.
“Farmers and ranchers need tax laws that protect their family businesses. They don’t want to be punished for their success,” AFBF President Bob Stallman said. With the House passage of the bill, “we are one step closer to tax reform that will help farm families invest in the future and pass their businesses on to the next generation.”
Estates worth more than $10.9 million for couples and $5.4 million for individuals fall under the tax. The Congressional Budget Office and the Office of Management and Budget have projected about $20 billion in revenue from the estate tax this year.
U.S. farm families often have the potential to get squeezed by the estate tax, because their assets are tied up in land, equipment and structures that are essential for farming. Faced with a tax on the transfer of those assets, family members often have few options other than selling off land or equipment, to their farms’ detriment.
“Previous Congressional action to increase the exemption provided important relief, but estate taxes still weigh on many farm families,” Stallman said. “Some must slow growth to remain exempt. We need tax policies that help capital-intensive businesses like farms and ranches and that don’t stand in the way of sons and daughters ready to follow the agricultural legacy of their parents.”
The bill is expected to face an uphill battle in the Senate. The White House also has threatened a veto.
Virginia enacted legislation in 2006 that repealed the state’s death tax for estates of owners who died on or after July 1, 2007.