The link at the end of this blog will now work for everyone, not just Californians. Thank you for your support.
America’s family farms, ranches and businesses face a serious ultimatum upon the death of a parent or grandparent whose name is on the title. When we lose that loved one, we then have to make some very difficult decisions, particularly on how to meet the estate or inheritance tax for the property that is to be handed down to the next generation. This is not just an agricultural issue; this directly affects rural economies, environmental sustainability and food production.
H.R. 3524, The Family Farm Preservation Tax Act, would allow families to pass the farm or ranch, and assets, to the next generation, exempt from estate taxes. This bill was introduced by Representative Mike Thompson and Representative John Salazar and would also exclude land that is enrolled in a qualified conservation easement.
Some would suggest doing proper estate planning and securing ample life insurance would alleviate this problem, however, what they do not understand is the following. The tens of thousands of dollars, spent on legal bills and insurance could be spent reinvesting in the farm or ranch. Reinvestments that would make the land more efficient, beneficial to wildlife, and have the potential to expand and benefit the local economies by hiring employees and generating demand at local businesses.
Being able to keep the family farm or ranch in the family is also a major benefit for the environment. When farms and ranches are split up and sold off, often times it goes under development, eliminating valuable habitat and placing even more regulatory pressure on the portions of the ag land that remain in production.
Furthermore, as more and more agriculturally productive land is split off and sold to cover estate and inheritance taxes, less and less land is available to produce food. Couples the reduction in productive land, with regulatory restrictions and Mother Nature and you have a recipe for potential food shortages and higher food prices.
Please voice your support for agriculture, and family farmers and ranchers by going to the following link http://bit.ly/11ClwB , join Farm Team and send your support and or estate tax story to Washington D.C. Voice your support for H.R. 3524 and the American farmer and rancher.
Friday, September 4, 2009
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About Me
- JeffFowle
- Jeff Fowle is a fourth generation family farmer and rancher from Etna, California. He and his wife Erin and son Kyle raise registered Angus cattle, Percheron draft horses, warmbloods, alfalfa and alfalfa-grass hay. They also start and train horses for riding, jumping, and driving. Their family run ranch has incorporated many environmentally beneficial and water efficient technologies and management strategies. Jeff attended college at Colorado State University for two years and Cal Poly San Luis Obispo for four and earned his Bachelor of Science degree in Animal Science. Following college, he worked in Washington State for a year as a herdsman for BB Cattle Company and then returned to Etna, California in 1995 to own and operate KK Bar Ranch and Siskiyou Percherons. The latter was started by his grandfather, Clarence Dudley, who devoted much of his time to the Percheron Horse Association of America, specifically to developing their youth education program.
Jeff, as a producer in IL I am very concerned with the implications of this legislation. In our area absentee landlords are the norm, either through years of inheritance, 1031 exchanges, or investor. This has driven land prices as well as rents to even tighter profit margins. In some areas mega producers operate on $10/acre profit margins driving out competition at all levels.
ReplyDeleteFrom what I have read on HR3524 I forsee even higher land prices and greater serfdom for farmers as more people flock to land as an estate tool since material participation, as defined by FSA would still keep investor types estate tax exempt.
To truly preserve family farms as well as other small businesses the estate tax should be eliminated as it is double taxation and hurts all in our economy. Our government has legalized this theft so I see little option but to persuade an increase in the overall estate tax limits. I understand AFB with Sen. Baucus (D-MT) is pursuing such legislation and urge you to support legislation that benefits all Americans. http://www.fbactinsider.org/petition.jsf?petitionUuid=970e4ddf-fa43-4829-940d-9e486cd31301
@agmatters
Connie S.
Connie,
ReplyDeleteThank you for your input. I completely understand your position. HR3524 has been years in the making. It is the most likely to pass out committe from the House and provide a building block to further improvements in the system.
While an increase in the taxable limit would help, exemption is what we are looking for. While the increase may be favorable for some regions of the country, in a state like CA, with some ag land valued at over $45,000 / acre, it would still not prevent the need to break up farms and ranches in order to pay the debt.
Ultimately, keeping farms and ranches intact, and in production, does benefit all Americans and the world, by maintaining food security.
Thank you for comments, and I respect your position.