The U.S. Senate last week passed its version of the 2018 farm bill in an 86-to-11 vote. Like the House farm bill, the Senate version is evolutionary in the sense it retains much of current commodity programs but tweaks some of the minutiae. Continue reading →
Lawmakers moved forward on federal tax reform after negotiators agreed to language in a conference report. Both the House and Senate are voted on the conference report this week. Many farmers and ranchers continue to ask whether property taxes paid on agricultural land, buildings, and equipment in their farm or ranch operations could still be deducted. Yes—the conference report does not change the ability to deduct property taxes as a business expense by farmers and ranchers on Schedule F, Schedule E, or Schedule C. The report does establish a $10,000 limit on the deduction for state and local income and property taxes, but the limit only applies to itemized deductions claimed on Schedule A filed by individual filers. Even though most farmers file income taxes as individuals, business income from a farm or ranch is reported on Schedule F, E, or C, where property taxes can still be deducted as a business expense.
The federal tax reform saga has turned a page and is moving into the next chapter in the U.S. Congress. On the House side, the Ways and Means Committee advanced H.R. 1, the Tax Cuts and Jobs Act, to the House floor with a committee amendment. The full House is expected to take up the bill later this week. On the Senate side, Senate Republicans last week released a draft of a reform proposal which differs markedly in some provisions with the House plan. The Senate plan will be taken up by Senate Finance Committee this week.