JM Innovations
Produce Promotions

North Dakota Ag News Headlines
Watne: Farmers Should be Aware of Tax Reform Implications
North Dakota Ag Connection - 11/27/2017

While the U.S. House of Representatives' newly passed Tax Cuts and Jobs Act aims to simplify the tax code and cut taxes for individuals and corporations, it may possibly raise the tax burden on family farmers and ranchers if left unchecked by the U.S. Senate or conference committee, according to North Dakota Farmers Union (NDFU) President Mark Watne.

Provisions that are important to agriculture like deductions on state and local taxes, accelerated depreciation (Section 179), carryback provisions, "like kind" exchanges, and Section 199 for cooperatives could be eliminated, capped or reduced depending upon the outcome of congressional action. Watne said the lowering of individual tax rates may not be enough to offset the elimination of these deductions.

"With the rush in Congress to pass tax reforms by year end, there are just too many unknowns," Watne said. "We need to slow down, get the nonpartisan CBO score and determine exactly what the tax implication is for farmers, especially if tax cuts aren't offset by growth in GDP. The last thing we need on the farm is increased taxes."

Watne said statutory pay-as-you-go (PAYGO) rules require that increases in deficit spending be offset by reduced spending in non-exempt mandatory programs, such as ARC, PLC, disaster assistance programs for commodities, and administrative costs for crop insurance delivery.

"I'm very concerned about the pot of money we will have available to write farm bills," said Watne. "The baseline for farm bill funding has been cut already by $100 billion over the past 10 years. It's too low of a benchmark to begin with and we can't afford to slash farm programs, like crop insurance, to fund tax cuts. That would be disastrous for agriculture and for our country."

Watne said Farmers Union is working with others to develop a tool that farmers can access online to determine what their tax burden will be given different tax scenarios.

More from this state at:
North Dakota Ag Connection

Machinery Pete
Riverside Plastic Inc./RSI Calf Hutches
Copyright 2018 - All Rights Reserved.