Estate Tax Relief

Because the estate tax, more commonly referred to as the death tax, is one of the leading causes of the breakup of multi-generation family farms and ranches, farm groups are making another push for permanent and meaningful estate tax relief. This outdated tax forces farming and ranching families to sell off land, equipment, parts of the farming operation, or sometimes even the entire farm or ranch to pay off tax liabilities on assets that have probably been taxed several times already in the course of a lifetime. Currently, estates worth more than $5 million per individual or $10 million per couple are taxed at a 35 percent rate, but that expires at the end of this year. Legislation that would reform the estate tax has been introduced in both houses of Congress. If Congress doesn’t act though, the exemption drops to one million and the top tax rate above the exclusion amount jumps to 55 percent. Since a permanent estate tax repeal is highly unlikely, most farm groups are in support of keeping the estate tax at its current levels. For now, estate tax relief remains an uncertainty. One thing is certain, the death tax hurts family owned farms and ranches hardest.