The Preserving Family Farms Act of 2019, co-sponsored by Indiana Congresswoman Jackie Walorski (R-02), helps farm families continue to operate after the death of a loved one.
Legislation in 2017 temporarily increased the estate tax exemption, benefiting farm families. Paul Schlegel, American Farm Bureau Federation Public Affairs Vice President, says this bill will provide another needed relief from the estate tax.
“It essentially would allow a farmer or a rancher when they inherit land to value that asset as agricultural land as opposed to say what a developer might pay for it. By doing that, we’re hoping to keep more farms in operation in allowing heirs to continue farms and business.”
Schlegel says developers often pay more than what agricultural land is worth.
“If a developer wants to come in and purchase it, they could pay a lot more per-acre than you might otherwise get if you value it as agricultural. And by relieving that burden of the estate tax, there’s far less tax liability for operators.”
Schlegel says the update is needed by farmers and ranchers.
‘This particular provision that the legislation addresses, it’s kept pace with inflation, but it’s fallen woefully behind what land values are. So, by doing this, we’re hoping to catch up and make sure that the tax burdens aren’t too great.”
The bipartisan bill is also sponsored by California Democrat Jimmy Panetta.