Two million family farmers would see their Death Tax exemption slashed in half.

WASHINGTON, D.C. – America’s family farmers are going to feel pressure in the coming months to start dialing up estate planners if Congress fails to act swiftly in the new year to extend the 2017 Trump tax cuts. Should those tax cuts be allowed to expire, two million family farmers would see their Death Tax exemption slashed in half. That would leave more of these small family-owned businesses facing the Death Tax’s 40 percent tax rate and an uncertain future.

Ways and Means Committee Chairman Jason Smith (MO-08) issued the following statement on the need to protect family farmers from needless uncertainty and higher taxes:

“Farming is inherently fraught with uncertainty which is why it makes zero sense for Congress to compound that challenge by leaving America’s family farmers and ranchers in limbo about whether they are due for a massive tax increase. Just like other small businesses, farmers have to plan for the future and prepare for how they will operate and whether they can afford to pass along their business to the next generation. With the threat of the increased Death Tax around the corner, farmers will have to start calling on lawyers and accountants to help them prepare for how to navigate an uncertain future and decide if they can afford to keep some or all of their family business.”

Key Facts:

• The 2017 Trump tax cuts doubled the Death Tax exemption and indexed it for inflation each year, protecting more family businesses from the Death Tax’s 40 percent rate. 
• 96 percent of farms in the U.S. are family-owned, 88 percent are small family farms.

Key Policies from the Trump Tax Cuts Set to Expire if Congress Fails to Act:

• Congress only has 149 legislative days next year to act before the Trump tax cuts expire.
• The average taxpayer would see a 22 percent tax hike if the Trump tax cuts expire.
• A family of four making $80,610, the median income in the United States, would see a $1,695 tax increase if the Trump tax cuts expire.
  • This is worth about 9 weeks of groceries to a typical family of four across the country.
• 40 million families would see their household’s Child Tax Credit cut in half.
• 91 percent of all taxpayers would see their guaranteed deduction slashed in half. 
• 26 million small businesses would be hit with a 43.4 percent top tax rate if the Section 199A Small Business Deduction expires.
• 7 million taxpayers would be impacted by the return of the Alternative Minimum Tax.
• 2 million family-owned farms would have their Death Tax Exemption slashed in half next year.

READ: Rural America Faces Family Farm Crisis if Trump Tax Cuts Expire