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Sensenbrenner Bill Aims to Exempt Farms From 'Death Tax'
USAgNet - 09/19/2016

A Wisconsin congressman is drafting legislation that would prevent the Internal Revenue Service from placing estate tax regulations on family-owned farms and businesses. Rep. Jim Sensenbrenner says the IRS is proposing what he calls 'new and harmful regulations' that would hurt family-owned businesses.

"Currently, valuation discounts exist for family business owners to make the transition from the owner to an heir after death more manageable," Sensenbrenner said. "The IRS-proposed regulations would eliminate these valuation discounts, forcing many family-owned businesses to sell."

The Republican lawmaker says these regulations would be particularly damaging to family-owned farms, many of which often have large assets due to land holdings, but maintain relatively modest incomes.

"The IRS should not be in the business of making it difficult for family-owned businesses to keep their doors open, especially during a difficult time such as the loss of a loved one," he said. "At a time when the economic outlook is precarious and full of uncertainty, it's critical we do everything we can to keep our nation's small and family-owned businesses well and flourishing."

Under current law, there are valuation discounts available for family business owners for purposes of estate and gift taxes, due to the lack of an identifiable market for the business. Sensenbrenner says the fair market value of an interest in a family-held business is based on what a willing seller would be able to receive from a willing buyer.

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