One of the first questions about a new administration in Washington, D.C., is what changes can the farm community expect when it comes to tax policy?
Pat Wolff, Senior Director of Congressional Relations with the American Farm Bureau Federation, said there she expects to see “big tax legislation” fairly soon, maybe in the first six months.
“And the reason for that is the Democrats have talked about some big policy changes in the next Congress. Different parties have different policies, and as I’ve said, the Republicans have spent the last couple of sessions in Congress enacting business-friendly policies. The Democrats have said that they would like to focus more on individuals, and they’re talking about raising taxes on high-net-worth individuals and businesses.”
The Democrats control both chambers of Congress by a slim margin. However, Wolff said that doesn’t mean it’s not going to be a challenging next four years.
“That doesn’t mean there aren’t going to be some major challenges to some things that Farm Bureau cares a lot about. Those are estate taxes and capital gains taxes. During the campaign, there was quite a bit of talk on the Democratic side about the estate tax exemption. The exemption now is a little over $11 million per person. It will stay at that level through 2025. But it has been said that Democrats would like to shrink that exemption; cut it in half, and some even going so far as saying they would take it down to $3.5 million.”
Wolff added she also expects to see tax incentives for environmental provisions such as wind energy, biodiesel, fuel pumps, alternative fuels, and carbon sequestration.
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