Estate taxes are a critical, high-priority issue for farm families and farm organizations as the sun could literally set on current estate tax policy at the end of 2012 if the law is not changed before then.
Bob Stallman, president of the American Farm Bureau Federation says, “It’s very important that estate taxes be on our priority list for 2012 because without a change in law at the end of 2012, the current law sunsets, and we revert back to the very old exemption level of $1 million a year and a 55 percent tax rate. This would be devastating to farm and ranch families where they are trying to pass the farm and ranch down from one generation to the other.
“Agriculture is a very capital intensive business,” he adds. “The land itself costs a lot of money. Land prices have been rising to as much as $5,000 to $10,000 an acre for really good agricultural land. At a million dollar exemption level, you really don’t even have a viable number of acres to maintain a farming operation, and you have tractors and combines that cost in excess of $250,000.”
Even as early as last March during a trip to Washington, D.C., Bobby Morris, a member of the Louisiana Farm Bureau Young Farmers & Ranchers, acknowledged to Rep. Rodney Alexander (R-Monroe) that “Raising the amount to $5 million was a big help to us,” but “this tax needs to be done away with completely.”
The real challenge in getting Congress to address and take action on estate tax policy in 2012 is that this is an election year. And as one of the Web Poll respondents says in the “Comments” section, “It’s not practical from a politician’s point of view to pass any kind of tax reform before a major presidential election.”
On that note, Cotton Farming asked its readers if they thought estate tax reform to benefit family farms will happen in 2013 after the elections.
Fifty-five percent of the respondents say, “No,” while 21 percent are more optimistic and are going with “Yes.” Twenty-four percent of the Web Poll recipients haven’t committed either way and believe that “It depends.”
Following is a sampling of the many comments that we received on this subject from those who participated in the poll.
• “You have to hope the Democrats are out. If not, then estate tax reform is out the door.”
• “I doubt that they will set it at $5 million per person – man and wife. I’d be satisfied if they keep it as it is although many farmers are already near that figure.”
• “If the GOP wins back the Senate, wins the Presidential election and maintains control of the House, then there is a possibility that we might get some relief from the estate taxes.”
• “I am a tax accountant as well as a farmer. I don’t see much benefit on the horizon for farmers in any capacity. From my perspective, the alternative minimum tax needs addressing more urgently than the estate tax.”
• “If Obama goes back in, then I see no relief in estate taxes. If Republicans win the White House and a majority of Congress, then relief is very possible.”
• “I think that some type of tax reform is needed, but I hate to see what my family has worked and paid for endangered by an unreasonable estate tax. Farmers are the ‘backbone’ of this country, and their assets need to be protected.”
To participate in this month’s Web Poll, go to cottonfarming.com to cast your vote and share your comments. Please include where your farming operation is located, so readers can better relate to what you are talking about. Results of the February poll will be reported in the March issue of Cotton Farming.
Web Poll Results
Do you believe that estate tax reform to benefit family farms will happen in 2013 after the elections?
• Yes – 21
• No – 55%
• It depends – 24%
February Web Poll Question
In 2012, do you feel more confident than you have in the past in your potential weed control program, including herbicide-resistant weeds?
Please share your thoughts in the “Comments” section.
(3) It depends.
Register your vote