More than 180 agricultural groups are coming together to support the Section 199 tax deduction not included in the tax reform proposal.
The groups, led by the National Council of Farmer Cooperatives, penned a letter to House Speaker Paul Ryan and Minority Leader Nancy Pelosi opposing the effective repeal of Section 199. By not including the deduction, the House tax reform legislation would eliminate Section 199. The letter states that ending the deduction would “result in many individual farmers paying more in taxes,” seeing up to double-digit increases in tax bills.
Section 199 allows cooperatives to deduct the proceeds earned from products that are manufactured, produced, grown, or extracted and pass those deductions directly back to their farmer-members.
The letter emphasizes that with most of agriculture facing the fourth consecutive year of stagnant prices, now is not the time to raise the tax burden on farmers.
From the National Association of Farm Broadcasting News Service.