Estate tax exemption level expires
Washington—In Idaho and across the nation, The estate tax exemption level expires in 2025.
That's more than four years away, but With gridlock in Washington, experts say it could take years to get legislation through Congress, If lawmakers cannot get legislation passed, it’ll threaten the family farm forever.
The Tax Cuts and Jobs Act includes the estate tax exemption. The Farm Bureaus says the current exemption covers the transfer of assets up to $11.5 million. The Farm Bureau’s John Newton.
“And after December of 2025, that amount returns to a $5 million inflation-adjusted level. So, if we don’t get a permanent extension of the 11.58 million, or we go back to a lower exemption level, that really risks the family farm operations across the country,” said Newton.
Estate taxes are a tax on the transfer of property following a death.
“If you have asset values that are above that $11.58 million, those are going to be subject to the estate taxes, which can be as high as 40 percent. If we potentially lower the estate tax exemption to 3.5 million, or an inflation-adjusted five million, we’re looking at more assets out there being subject to additional taxes. And some are looking at that as a pay for to pay for other policy objectives,” said Newton.
The Farm Bureau says farmers need a permanent fix, to keep family farms operational.
“A lot of folks often point out that it’s a small percentage of the farm population across the country that would be subject to these estate taxes. But when you look at USDA data, it’s actually a large percentage of the agricultural land area in this country that could be subject to these estate taxes upon death. So, we urgently need a fix to help and protect the family farm operations,” said Newton.
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