Agriculture Majors Beware – the Death Tax Increase Will Kill Family Farms
Obama’s proposed increase of the death tax will kill family farms. Those studying Agriculture at universities should pay attention to this.
M. Addison Whitaker from the College Conservative has the story.
Death Tax Increase Will Kill Family Farms
Farmers, by and large, are not “rich people.” They are rich in values, integrity, and character, but seldom in money. A farmer may bring home $75,000 dollars or more in a good year. But if drought or low prices strike, a farmer could be looking at an annual income that is in the red. These aren’t the people who were targeted with the death tax, but since farming is an expensive gig, the value of their land and equipment could easily put them above the current $5.25 million capital gains exemption.
Farm land is a hot commodity in the US. While the government may print more money, it can’t print more land. And with an increasing population and urban expansion, demand for land–especially fertile land–is skyrocketing. According to the USDA Land Values 2013 Summary, the average value of an acre of farmland for the entire US is $2,900. In Iowa, where the ground is optimal for row-crop production, the average is $8,600 per acre! So a 500 acre farm in the Hawkeye State has an average value of $4.3 million, and that is just the soil! Add in buildings and equipment (a combine harvester alone can cost upwards of $300,000), and the farmer can easily be seen as a wealthy person in the eyes of the taxman. Unlike other investments, however, farming does not yield lofty returns. After paying for seed, fertilizer, herbicide, labor, and a myriad of other expenses, farmers may do well just to break even.
When a farmer dies, his children will be taxed as heavily on their parent’s farm as they would be if they were left a mountain of cash from an oil tycoon. That’s downright disgraceful. Many will not have the cash to pay that tax, and will have no choice but to sell the farm. Whether this affects just one farm or one million farms, this tax is abhorrent. No family should have to part with their farm just because a loved one died.
Comments
This is a “straw man,” not worth worrying about. This proposal, along with virtually all of Obama’s agenda for changing this country leftward are DOA on arrival in the Congress. Changing taxes is beyond executive memo or order. This president is a politically repudiated lame duck whose powers are now limited fairly strictly to what an executive can do with “phone and pen.” He is now largely irrelevant in the legislative arena. My guess is that as we get closer to the 2016 elections, even the Democrats in Congress will be running away from him and voting with the GOP to save their chances to avoid Obama’s ruining the Democrat Party in 2016 as he did in 2014. The idea that his legislative proposals will be taken seriously should be the subject of humor and laughed at.