An expiring estate tax could be very costly for farm estates. That’s coming up on This Land of Ours.
The 2017 Tax Cuts and Jobs Act significantly changed federal individual income and estate tax policies, though some were temporary. In 2018, the legislation increased the estate tax exemption amount from $5.49 million to $11.18 million. This increase expires at the end of 2025. The exclusion amount will revert in 2026 to $6.98 million per deceased person.
Researchers with USDA’s Economic Research Service (ERS) estimate the expiring increased exemption would be $13.95 million per person at the time of the expiration. Lowering the estate tax exemption level in 2026 could increase the percentage of farm operator estates taxed from 0.3 to 1.0. Large farms would experience the largest increase in the share of estates that owe estate tax, increasing from 2.8 to 7.3 percent. Allowing the provision to expire could cause more than doubling of the total federal estate taxes for farm estates to $1.2 billion.
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Sabrina Halvorson
National Correspondent / AgNet Media, Inc.
Sabrina Halvorson is an award-winning journalist, broadcaster, and public speaker who specializes in agriculture. She primarily reports on legislative issues and hosts The AgNet News Hour and The AgNet Weekly podcast. Sabrina is a native of California’s agriculture-rich Central Valley.