U.S. Reps. Jackie Walorski (R-Ind.) and Jimmy Panetta (D-Calif.) Wednesday introduced the bipartisan Preserving Family Farms Act. The legislation would help family-owned farms continue operations after a loved one has passed by easing the burden of the estate tax. The bill would modernize the special use valuation provision of the estate tax by increasing the amount of farmland that can be valued for farming operations rather than development value. This would protect family-owned farmland by assessing estate taxes on the actual value of their businesses that they, in many cases, have spent decades cultivating.
“Hoosier family farmers are the backbone of our economy, and they work hard to put fresh food on our tables,” Congresswoman Walorski said. “They shouldn’t have to make the difficult decision to sell or break up their farm because of a crushing tax bill after the death of a loved one. The Preserving Family Farms Act would update existing provisions in the tax code to ensure estate taxes are based on the value of farmland as it is actually used, not its highest potential value if it was sold for development. This commonsense, bipartisan bill would give the next generation of farmers a better chance to carry on their family’s legacy and keep family-owned agricultural businesses going strong.”
“Estate taxes on family-owned farms have forced families to split up the land they have spent generations building,” said Congressman Panetta. “Our Preserving Family Farms Act would ease this burden by ensuring that these farms are appraised by the value of their business, rather than development value. This much-needed fix would preserve agriculture lands and protect many of the Central Coast family-owned farms that provide our food security.”
“Estate taxes can have devastating consequences on family farms. The special use valuation is an important tool to help farmers and ranchers navigate the difficult process of estate planning. Next-generation farmers and ranchers should be able to pay based on the actual use of the land, rather than its potential value as commercial property such as an office or warehouse. AFBF is grateful
Representatives Panetta and Walorski introduced the Preserving Family Farms Act of 2021, which will help more farm and ranch businesses transition to the next generation. We call on Congress to pass this legislation,” said American Farm Bureau Federation President Zippy Duvall
“America’s farmers and ranchers deserve certainty in the tax code overall, and they need certainty especially when it comes to the estate tax. Without it, transition planning for the next generation of producers is nearly impossible. NCBA is committed to the fight to defend family ranches and farms and has long advocated for sound policies, such as expanding IRS Code Section 2032A to allow more ranchers and farmers to take advantage of the Special Use Valuation that will preserve family-owned beef operations for generations to come. We applaud Representatives Panetta and Walorski for their leadership and dedication to protecting future generations of agricultural producers through the introduction of the Preserving Family Farms Act of 2021,” said National Cattlemen’s Beef Association President Jerry Bohn.