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Concerns continues over estate tax increase
Buckeye Farm News
Unless Congress acts this year, the federal estate tax, commonly called the “death tax,” is scheduled to increase to 55 percent with a $1 million exemption at the beginning of 2011.
That could hit farmers hard, because 84 percent of farm assets are real-estate based, wrote AFBF President Bob Stallman in a letter to U.S. Sen. Harry Reid this summer. Stallman expressed support for a proposal to permanently set the estate tax rate at 35 percent, with a $5 million exemption phased in over 10 years and indexed for inflation.
“When estate taxes are due, surviving family members without enough cash on hand may be forced to sell land, buildings or equipment they need to keep their operations going. Rural communities and businesses also suffer when farms and ranches downsize or disappear and farmland close to urban centers is often lost forever to development when estate taxes force farm families to sell off land to pay the taxes,” he wrote.
As many as 10 percent of farms and ranches could owe estate taxes next year, according to the Agriculture Department. In comparison, only about 1.5 percent of farms had to pay the tax in 2009, when the exemption was $3.5 million.
OFBF has also been involved with a summer-long campaign to gather postcards signed by farmers that will encourage Congress to “Put Death Taxes to Rest.” The postcards will be delivered this fall.