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True impact of tax bill to farmers still unknown

 

American Farm Bureau’s tax policy specialist says new business rates in the House Ways & Means tax bill will have the greatest impact on farmers’ taxes.

Pat Wolff tells Brownfield the measure proposes a new way of taxing business income, lowering the rate for corporations. But she says the impacts to pass-through businesses, which are the majority of the nation’s farms and ranches, are still unknown.  “Very few farms are incorporated so this new taxing scheme where income will either be categorized as business income or personal income will impact almost all farmers.”  She says the repeal of the estate tax is a big win for their members as well as continuing the business interest deduction and increasing immediate expensing.

The president of National Council of Farmer Cooperatives Chuck Connor tells Brownfield he believes most of their members will see a significant tax increase with the elimination of Section 199, the Domestic Production Activities Deduction, in the proposal.  “This bill raises farm taxes and the unfairness of that—when we’re offering most Americans very substantial tax relief, which is a good thing—you can’t do that on the backs of the American farmer.”  He says Congress could easily preserve the 199 exemption for agriculture, which is not benefiting from any corporate rate reductions, without making a large impact to the rest of the bill.

Wolff says tax reform is on the fast track to be passed through Congress before the end of the year.

AUDIO: Interview with Pat Wolff

AUDIO: Interview with Chuck Connor