The enhanced estate tax exemption could be a major casualty if the 2017 tax cut law expiring at the end of 2025 is not extended.
The estate tax exemption will drop from $13.6 million per individual to its pre-2017 level of $5.5 million if the Tax Cuts and Jobs Act isn’t extended.
Here’s Ken Bacus, with the National Cattlemen’s Beef Association (NCBA), on a recent Farm Foundation panel discussion.
“If we do see limits revert back to those pre-2017 levels, then that’s going to affect about 61 percent of our survey respondents. And that is not something that we take lightly.”
Especially since many producers say they’ve already been hit by the estate tax.
“A third of our respondents have already had to pay the death tax once, and from that number, another 35 percent have had to pay it more than once.”
Given that, Bacus says many farm and ranch operations are asset-rich and cash-poor. Land values are one reason.
“Whether its pastureland or farmland, you know, demand for development. Real estate development for farmland is always a constant pressure. So, it’s not just that we’ve been setting record values on cattle prices and everything else – it’s the land values that have gone up.”
That’s Ken Bacus with the NCBA.