Passing a family farm on to the next generation may become less challenging, thanks to the reintroduction of legislation to repeal the federal estate tax, also known as the “death tax”.
Cosponsored by Oklahoma Sen. Jim Inhofe, the Death Tax Repeal Act of 2017 was introduced on Tuesday in both the U.S. House and Senate.
“For too long the death tax has burdened our farmers, ranchers and small business owners in Oklahoma,” Inhofe said in a release. “I’m proud to have cosponsored this legislation, which prevents the government from double-dipping into the pockets of hard-working Americans.”
“The death tax has created many undue burdens for Oklahoma farmers and ranchers,” said Tom Buchanan, president of the Oklahoma Farm Bureau. “In many instances, it has forced liquidation of the land itself.”
Estate taxes are imposed on inherited assets that exceed the $5.45 million per person exemption. If estate taxes on farms or agricultural businesses are greater than cash or liquid assets, the surviving family member may be forced to sell land, equipment or other assets to keep the farm running.
“We believe that repeal of the estate tax offers the best solution to protect farms, ranches and all family-owned businesses from the estate tax,” American Farm Bureau Federation President Zippy Duvall said in a statement. “Farmers and ranchers face a number of factors that are unpredictable and beyond their control, from changing weather to fluctuating markets,” Duvall said. “These family-run businesses need a tax code that encourages investment, rather than one that punishes their success.”
See the full text of the Senate measure here.