Protect Stepped-Up Basis for American Family Farms!
Proposed legislation in Congress would tax capital gains at death and eliminate stepped-up basis as a way to raise revenue for government spending. This would be devastating to American agriculture.
- Many farmers and ranchers hold assets such as land for decades, passed on from generation to generation.
- Stepped-up basis is a process that allows a farmer to pay capital gains taxes only on a property’s increase in value since the time that land was inherited, instead of paying the full increase in value since it was purchased by a deceased relative.
- In addition, the tax on the new stepped-up value is deferred until property is sold by the surviving family member.
Now is not the time to impose a massive new tax that could put families out of business.
Funding the government should not come from targeting hardworking families who have spent a lifetime building businesses and creating jobs. Farmers have endured weather disasters, trade wars and COVID-19 – immense burdens that would destroy less resilient industries. Still, we are #StillFarming.
Farms are often kept in the family for many years. Tracking the appreciation of land and equipment over a period of decades would be extremely complex, and the value of land is likely to have increased so much that without stepped-up basis the next generation of farmers and ranchers could be forced to sell the land just to pay the taxes.