AFBF President Zippy Duvall today commented on the introduction of a bill to help more farm families continue their livelihoods after the death of a loved one.
“Estate taxes can have devastating consequences on family farms. The special use valuation is an important tool to help farmers and ranchers navigate the difficult process of estate planning. Next-generation farmers and ranchers should be able to pay based on the actual use of the land, rather than its potential value as commercial property such as an office or warehouse. AFBF is grateful Representatives Panetta and Walorski introduced the Preserving Family Farms Act of 2021, which will help more farm and ranch businesses transition to the next generation. We call on Congress to pass this legislation.”
The Preserving Family Farms Act of 2021, sponsored by Reps. Jimmy Panetta (D-Calif.) and Jackie Walorski (R-Ind.), modernizes the special use valuation provision of the estate tax. This valuation allows property to be appraised as farmland rather than its commercial development value when determining estate taxes.
Farm and ranch families who choose to use the special use valuation commit to continue operating their farm or ranch business for 10 years. If they stop farming or ranching, sell the farm or ranch outside of the family, or change the use of their property, they must repay the forgiven estate taxes.