By Scout Nelson
A tax package recently passed by the U.S. House Ways and Means Committee could bring much-needed relief to family-owned farms and cattle operations. The bill includes important tax changes designed to support rural producers and small businesses.
One of the major changes in the package is the permanent increase in the federal estate tax exemption. Also known as the “death tax,” this exemption would rise to $15 million per individual and $30 million per couple. This change would help many family farms pass their operations down without facing large tax bills.
Other key changes include a boost to Section 199A small business deduction. This deduction would increase from 20% to 23%, allowing farms and ranches to keep more of their earnings. The Section 179 expense deduction limit would also rise from $1 million to $2.5 million. This allows producers to deduct the cost of equipment purchases more easily.
In addition, the bill reinstates 100% bonus depreciation for five years with no phase-out period. This means that cattle producers can fully deduct the cost of equipment and infrastructure investments immediately, helping support growth and sustainability.
“NCBA has long been advocating for full repeal of the death tax and while we continue to fight for full repeal, we are happy to see an increase in the exemption that will provide tremendous certainty to producers,” said NCBA Executive Director of Government Affairs Kent Bacus. “Expanding tax deductions like Section 199A, Section 179 and bonus depreciation will not only preserve family cattle operations but promote growth across America’s Main Street businesses and rural America.”
The bill now awaits approval by the full House of Representatives. If passed, it could provide lasting financial security for cattle producers and rural communities across the country.
Photo Credit:kansas-livestock-foundation
Categories: Kansas, Business, Government & Policy