Bipartisan Group Pushes for Stepped-Up Basis Tax Rule Protections

A resolution introduced Tuesday would support the “preservation” of the rule and “oppose efforts to impose new taxes on family farms or small businesses.”

Meanwhile, service prices and the core index (which excludes food and energy) remain high, with the core CPI descending to 4.8%.
Meanwhile, service prices and the core index (which excludes food and energy) remain high, with the core CPI descending to 4.8%.
(Adobe Stock)

A bipartisan group of lawmakers is trying to protect a tax provision that reduces the capital gains tax on inherited property, saying elimination would hurt farmers and businesses.

The Joint Committee on Taxation says the failure to collect these taxes costs $40 billion per year, and Democrats have proposed ways to eliminate the provision, while leaving an exemption for farmers.

The resolution, introduced Tuesday by Reps. Tracey Mann (R-Kan.), Adrian Smith (R-Neb.), Jim Costa (D-Calif.), Jimmy Panetta (D-Calif.), Angie Craig (D-Minn.), and Bob Latta (R-Ohio), would support the “preservation” of the rule and “oppose efforts to impose new taxes on family farms or small businesses.”

President Joe Biden’s budget request included changes that would tighten loopholes related to partnerships and the stepped-up basis rule and those who have over $100 million in wealth, according to the Treasury Department’s Greenbook. Democrats have said the provision allows the wealthy to avoid paying taxes.

Bottom line

The resolution cites a study from the USDA’s Economic Research Service that found 66% of midsize farms would see a tax liability increase if the stepped-up basis was cut.

AgWeb-Logo crop
Related Stories
New tax rules could let farmers who sell land defer, reduce and even wipe out capital gains tax starting Jan. 1, 2027.
Retired and disabled, Ron Hines was hounded for giving online animal health advice. No one ever complained. Except the state.
Farm CPA Paul Neiffer says several recent federal program and tax-related updates could have meaningful financial implications for producers, especially around SDRP payment limits, 2025 ARC/PLC payment expectations, standard mileage rates and payment-limit guidance.
Read Next
Matt and Janna Splitter grew their farm by investing in people. Now the test is whether the farm can run without them — and which acres are worth keeping.
Get News Daily
Get Market Alerts
Get News & Markets App