House Republicans are holding hearings this week about President Donald Trump’s “big, beautiful bill.” The bill could benefit agriculture, including positive tax provisions for farmers, an extension for 45Z and an increase in farm bill reference prices. However, potential changes to SNAP and putting more of the burden on states are also raising concerns.
Pieces of the overall bill passed both the House Agriculture Committee and the House Ways and Means Committee this week. Committee markup is the first test the provisions had to pass. The provisions from each committee will then be inserted into the overall bill.
The House Ways and Means Committee’s portion includes making 2017 tax cuts permanent, eliminating the estate tax and reducing taxes on interest income for agricultural loans.
Farm CPA Paul Neiffer calls the tax provisions very favorable for agriculture, rating them a 8 or 9 out of 10. Here’s why:
- As of Jan. 20, farmers will have 100% bonus depreciation for the next four years
- The Section 199A deduction that was at the 20% level will now be bumped up to the 23% level.
- Cooperative deductions will still be included
- Starting next year, Section 179 will increase to $2.5 million, up from $1 million
- An increase in the gift tax exemption amounts to $15 million per individual and $30 million per couple, adjusted for inflation annually.
Neiffer say farmers who’ve built net worth through land or other assets, there’s a piece of the legislation that will also benefit them.
“The lifetime exemption starting next year will be $15 million, and it’s made permanent,” Neiffer says.
The draft legislation also includes an extension of 45z tax credit. Established by the Inflation Reduction Act that was passed in 2022, it provides a tax credit for the production and sale of low-emission transformation fuels.
Increase in Reference Prices
On Wednesday night, the House Agriculture Committee passed its portion of the budget reconciliation package, but not without debate around farmer interests versus food stamps.
According to the House Ag Committee, the provisions increase Price Loss Coverage (PLC) reference prices to levels proposed last year. Those include:
- $4.10 per bushel for corn
- $10 for soybeans
- $6.35 for wheat
“Essentially, they took the proposal from last year and are going to stick it in this bill,” Neiffer says. “We’re going to have about a 10%-to-20% increase. Since it was effective immediately, I thought it might apply to the ’24 crop, but Jim Wiesemeyer reached out to let me know it’s likely going to apply for ’25. The problem I have with that, they were talking about immediate help for farmers, which if they’re applied to ’24, they’d be getting the help in October ’25. Now, if it’s applied to ’25, their help isn’t going to be until October ’26, at the earliest.”
In the proposal, farmers would also see payment limits increase from $125,000 per individual or entity to $155,000, starting with the current 2025 crop year.
Those in favor of the increase in reference prices on the House Ag Committee argue this is a vital lifeline for farmers at a time of great financial need.
“Since 2019, SNAP costs have skyrocketed from $60 billion to $110 billion annually, an 83% increase, while enrollment has grown from 36 million to 42 million,” said House Ag Committee Chairman Glenn “GT” Thompson (R-PA).
“The truth is our current farm safety net hasn’t kept up — it’s outdated and often it doesn’t even get triggered when prices drop,” says Rep. Zach Nunn, R-Iowa. “This is an investment that will provide predictability when prices fall and another provision to keep our crop insurance programs strong and intact.”
The Fight in the House Ag Committee Over SNAP
That includes a projected $290 billion cut to the Supplemental Nutrition Assistance Program (SNAP) over the next decade.
The plan also removes $290 billion from the program, redirecting some of that money to farmers by expanding support for commodities and crop insurance.
But Democrats on the committee spoke out against the cuts to SNAP benefits calling them a non-starter.
“The average SNAP benefit is about $6 per day. Let me say that again, $6 a day. You don’t build a life on SNAP. You build a bridge to the next paycheck,” says Rep. Angie Craig, D-Minn. “The cuts you are proposing to SNAP would be the largest rollback of an anti-hunger program in our nation’s history.”
Both the Committee’s portion of the legislation will also be rolled together into the bigger reconciliation package and must be reconciled with the Senate bill.
While it’s a long road until the complete bill is passed in Congress, Trump has said he wants this passed and plans to sign it on July 4.
Ag Groups React
The majority of ag groups support the tax provisions, saying this will be beneficial to farmers.
National Cattlemen’s Beef Association (NCBA) says the tax package must be approved by the House of Representatives as part of the reconciliation process.
“The Death Tax is a death warrant for family businesses and the top threat to family-owned cattle operations. NCBA has been working with members on and off the Ways and Means Committee for months to educate them about the needs of cattle producers and advocate for the tax provisions that are the most effective for cattle operations,” said NCBA President and Nebraska cattleman Buck Wehrbein. “This work would not have been possible without the broad participation we had in NCBA’s tax survey from producers, who detailed the struggles they have had with paying the Death Tax and what they would like to see in a broader tax package. This is a huge victory for grassroots advocacy and everyone that made their voice heard—from the producers that have not paid the Death Tax yet—to those that have paid it multiple times to avoid losing their livelihoods.”
Associations representing row crop farmers applaud the House Ag Committee’s push to adjust reference prices.
“We appreciate Chairman Thompson’s efforts to include key agricultural investments in must-pass legislation,” said Illinois farmer and National Corn Growers (NCGA) President Kenneth Hartman Jr.
However, the cuts to SNAP are a concern for others. The National Young Farmers Coalition, a group who says its vision is to create a future where farming is “free of racial violence, accessible to communities, oriented towards environmental well-being, and concerned with health over profit,” is against the proposed cuts.
“This budget proposal is a betrayal of the values that sustain our food system. These are not the investments young farmers need,” said Erin Foster West, Policy Campaigns Director of the National Young Farmers Coalition. “Instead of passing a bipartisan Farm Bill that builds resilience for farmers and families alike, this bill fast-tracks harmful cuts to nutrition programs that serve as both a safety net for families and a revenue stream for farmers. It trades long-term food security for short-term austerity.”
