CONGRESS PASSES ESTATE TAX RELIEF BILL
Congress delivered an early Christmas present to farm and ranch families on Dec. 16 when the House voted in favor of the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010.
The House voted 277-148 to approve the $859 billion bill that extends the 2001 and 2003 tax cuts for two years and sets the estate tax at 35 percent with a $5 million exemption through 2012. The Senate passed the bill by a vote of 81-19 on Dec. 15. It now goes to the president for his signature.
"Securing meaningful estate tax reform for farm and ranch families has been a top priority for Farm Bureau," said American Farm Bureau President Bob Stallman. "We are pleased the House left intact the estate tax provision that provides a $5 million exemption and maximum rate of 35 percent."
Other tax provisions included in the legislation, and important for farmers, include lower capital gains and income taxes and tax incentives for renewable fuels.
"We commend President Obama and congressional leaders for being committed to securing passage of this tax bill," Stallman said. "It offers considerable relief that will help farmers, ranchers and rural communities in these difficult economic times."
Although 2010 was an estate tax-free year, under a tax law passed in 2001 the tax would have returned Jan. 1, 2011, with a top rate of 55 percent and a $1 million exemption.
Eighty four percent of farm assets are real estate-based and had the tax rate returned to the 2001 level, surviving family members may have been forced to sell land, buildings or equipment to pay the tax.