The Tax Man Cometh To The Farm

Wed, 19 Feb 2025 15:52:13 GMT

Everyone can benefit from a practical reminder from time-to-time. In this case, Paul Neiffer wants to remind farmers that the 2017 Tax Cuts and Jobs Act is set to expire at the end of 2025.

“We’ve had these tax cuts for eight years now, but farmers may not be thinking about this and what it could mean for them,” said Neiffer, principal of FarmCPAReport.com and a Top Producer columnist.

Neiffer addressed the topic of what farmers need to know now and address from a tax standpoint during the 2025 Top Producer Summit in Kansas City.

“Certainly, farmers are aware of the lifetime estate tax exemption dropping in half after this year. But I think a lot of these other provisions that would hit them, they’re probably not quite as aware of them,” he said.

Neiffer highlighted three provisions he believes U.S. farmers are likely most interested in seeing extended or made permanent. They include:

1. The 100% Bonus Depreciation. Neiffer said he believes the 100% provision will be made permanent, though it’s currently only 40%.

“We think that will come back to farmers,” he said. “The practical benefit is when they purchase equipment or farm buildings they’ll be able to deduct 100% of that item in the year of purchase. Also, there is a chance that trade-in of farm equipment will be similar to the old rules and non-taxable in most situations.”

2. The increase in the lifetime exemption for estates. If the current law is left unchanged, as of Jan 1, 2026, the present lifetime estate and gift tax exemption will be cut approximately in half. It currently is almost $14 million.

Neiffer is optimistic about the exemption. “I think the likelihood on the estate exemption is very good. I think that’ll stay at least at the current level,” he said.

3. The Section 199A Cap. This provision allows individuals, trusts and estates with pass-through business income to deduct up to 20% of qualified business income (QBI) from taxable ordinary income. Schedule F farmers are also granted the 20% deduction.

While Neiffer said there is some bipartisan support in Congress for extending the Section 199A deduction beyond 2025, he is ambivalent about that happening. “With that 20%, it would be a lot more costly to enact,” he noted.

Practical Next Steps Farmers Can Take
Looking ahead, Neiffer said he believes the likelihood of having a major tax bill before the end of 2025 is slim. At best, the bill would be ready by November or December.

For that reason, Neiffer’s recommendation to farmers is for them to plan on pushing income into 2026 but to have the flexibility to bring that income back into 2025.

“The reason is if the tax cuts don’t get extended that means 2026 tax brackets are going to be a lot higher,” Neiffer explained. “So, we would want to bring income into 2025. Now, farmers have the ability to do that using deferred payment contracts and some other elections that they can make – but only if they plan ahead accordingly. They definitely want to make sure they do that,” he added.

Your next read: It’s Tax Time: Your Guide To Calculate Farm Income

Farm Journal to host free webinar on carbon markets

Fri, 23 Sep 2022 20:43:23 GMT

Lenexa, Kan. , (April 12, 2021) — What do farmers, ranchers and stakeholders across the food and agriculture value chain need to know about the emerging world of carbon markets? Farm Journal’s next Farm Country Update , “The Three Biggest Trends in Carbon Markets,” will feature a panel of experts to discuss how carbon markets are changing what farmers and ranchers are doing at the grassroots level. The online event is set for Thursday, April 15, 2021, at 3 p.m. CDT.

Panelists include:

Robert Bonnie, Deputy Chief of Staff for Policy and Senior Advisor, Climate, for USDA
Kelley Delpit, Oregon Rancher and Conservation Manager for Sustainable Northwest
Mitchell Hora, Iowa Row Crop Farmer and Co-Host of the Field Work Podcast from American Public Media
Kris Johnson, Interim Director of Agriculture, North America for The Nature Conservancy
Amy Skoczlas Cole, Executive Vice President of Trust In Food, Moderator

The one-hour session will include exclusive results from Farm Journal’s Pulse Poll conducted earlier this spring where farmers and ranchers were asked to share their views on carbon markets. Other discussion topics will include practical information highlighting what producers need to know as they’re evaluating their options in this rapidly changing business environment.

“Our research shows that the top thing farmers need when it comes to carbon markets is trustworthy information,” said Amy Skoczlas Cole, executive vice president, Trust In Food, a Farm Journal initiative. “This webinar will feature insights from farmers and ranchers actually doing the work of navigating the carbon market ecosystem and perspectives of leaders from government agencies and conservation non-profits positioned to help producers optimize their impact as environmental solutions providers while recognizing economic benefits in the process.”

Register now for this free online event at https://preferences.farmjournal.com/041521-FarmCountryUpdate_RegistrationPage.html . All registered attendees will receive on-demand access to the session when available.

About Farm Journal

Farm Journal is the nation’s leading business information and media company serving the agricultural market. Started 145 years ago with the preeminent Farm Journal magazine, the company serves the row crop, livestock, produce and retail sectors through branded websites, eNewsletters and phone apps; business magazines; live events including conferences, seminars and tradeshows; nationally broadcasted television and radio programs; a robust mobile-text-marketing business and an array of data-driven, paid information products. Farm Journal also is the majority shareholder of the online equipment marketplace, Machinery Pete LLC. In 2010, the company established the non-profit, public charity, Farm Journal Foundation, dedicated to sustaining agriculture’s ability to meet the vital needs of a growing population through education and empowerment.

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The Tax Man Cometh To The Farm

Farm Journal to host free webinar on carbon markets