Hoping the Best for the Lame Duck Session

Hoping the Best for the Lame Duck Session. I'm Greg Martin with today's Line On Agriculture. Farmers and ranchers are hoping the lame duck session of Congress is not, well, completely lame and addresses expiring tax cuts and incentives. WOLFF: Farmers and ranchers are facing a huge tax increase on January 1st if Congress doesn't act and they need to act soon. There's considerable confusion over what the tax rates will be. Farmers don't know what they're going to have to pay, what they're not going to have to pay and it makes business planning a nightmare. American Farm Bureau Tax Specialist Pat Wolff says members of Congress know that something needs to be done. The question is whether they can work together enough to reach a compromise. WOLFF: The biggest tax increase is the estate tax where the exemption will go down to a million dollars and the top rate will be 55 percent, but there's a long list of other tax increases facing farmers. Another big one is the capital gains tax where the top rate will jump from 15 to 20 percent and all of the individual income tax rates are set to go up. Wolff says Congress also needs to renew tax incentives for ethanol and biodiesel to protect the struggling renewable fuels industry. WOLFF: Farmers and ranchers are seeking certainty and we'd like to see the lower tax rates made permanent. Not sure that's quite in the political cards, so a good compromise would be a two or three year extension of the laws we have this year, except for estate taxes where they do need to take the initiative to provide additional relief. Wolff talks about renewable fuels tax incentives. WOLFF: There's a long list of incentives that are important to farmers and ranchers, too. The biggest are the energy tax incentives. The ethanol tax incentives expire at the end of this year, but the biodiesel tax incentives have been off the books for almost a year now. They ended at the year end of 2009 and the biodiesel industry has almost shut down because of that. Tax incentives for renewable energy provide the incentive to produce the fuel itself. There's a fine line between a company making money or losing money when it, for example, produces biodiesel. So when the tax credits went away, the profit went out of the industry the biodiesel industry shut down. That meant people lost jobs. That meant farmers lost markets for their soybeans and it meant that we lost a green fuel. That's today's Line On Agriculture. I'm Greg Martin on the Ag Information Network.