Federal Tax Policy Reform

Date: 7/07
Position Number: II-C
Expires: 3/08

Resolution/Position:

1. Support legislation to redefine hedging to allow producers who replace commodities with offsetting futures and options positions of similar commodities to have the profit or loss on those futures or options positions taxed as ordinary income or loss rather than as capital gain or loss.
2. Support full deductibility of term life, long term care, and health insurance premiums.
3. Support an investment tax credit and other incentives for capital investments.
4. Support authorization of tax-deferred accounts to allow agricultural producers to contribute to savings accounts that would be taxed at the time of withdrawal.
5. Support elimination of capital gains tax or any method to reduce capital gains taxes, including rate reductions, exemptions for farmland from capital gains, or indexing a property’s basis to inflation.
6. Support the continued use of commodity wages for agricultural employees.
7. Support efforts to exempt rental income from self-employment taxes.
8. Support incentives for farm (and other business) owners to transfer ownership to future generations during their lifetimes rather than allow the business pass through their estates.
9. Support legislation to permanently repeal the federal estate tax, and to retain the stepped up basis for estates. Also support legislation that may not eliminate the estate tax, but instead increase the exemption amount, and maintain an unlimited stepped-up basis.
10. Oppose a national flat tax as a method of tax reform if it does not include exemptions for business expenses.
11. Support legislation to increase the maximum gift tax exclusion per donor to $20,000 per done with annual adjustments tied to increases in the consumer price index.
12. Support the purchase of inputs financed by a lending subsidiary of the vendor to be deductible at the time of purchase.
13. Support a one time exemption from capital gains and income taxes on the first $250,000 in proceeds from asset sales resulting from the exit from farming.
14. Advocate establishing a farmer-transition program that would allow farmers to sell their land and put the appreciation into a personal retirement account.
15. Support changes in tax policy that would allow producer members of cooperatives to declare income from their investment only when the cash is actually received.
16. Support the volumetric ethanol excise tax credit (VEETC) and other tax incentives that promote the expansion of ethanol and renewable fuels.
17. Support that the federal tax code adjust the original basis for inflation in calculating capital gains.
18. Support efforts to repeal the alternative minimum tax.
19. Support expansion of the 1031 provision of the federal tax code to include investment in agricultural value-added ventures.