The Chairman of the House Ways and Means Committee, the tax writing committee of the House of Representatives, announced a draft of the federal tax reform bill will be released November 1. Leaders in both the House and Senate have expressed hope a tax package could be passed by Thanksgiving. One taxing concern on the minds of many farmers and ranchers is the fate of the deduction for state and local taxes (SALT). The concern is especially acute in Nebraska given the large amount of property taxes paid by agriculture, roughly $1.3 billion in 2016.
Under the unified framework for tax reform, the Trump Administration and Republican Congressional leaders said they want to simplify the federal tax code by repealing all itemized deductions, except deductions for home mortgage interest and charitable contributions. Itemized deductions are claimed by individuals on Schedule A filed with Form 1040. Most farmers and ranchers file taxes as individuals-the 2012 USDA Census of Agriculture showed 85 percent of Nebraska farms filed taxes as either an individual or family. Additionally, only 28 percent of farmers and ranchers itemize deductions. It is these operations who itemize deductions the loss of the ability to deduct state and local taxes could affect. The average annual deduction for state and local taxes reported by farm sole proprietors on Schedule A for 2009-2015 (excluding 2013) was $128.4 million. Presumably, the deduction is for state income taxes, property taxes on farm residences, and taxes on personal vehicles. For these operations, the loss of the deduction could increase federal income taxes an estimated $18 million per year if not offset by other changes.
Farmers and ranchers also deduct state and local taxes paid as a business expense for their operations, be it as sole proprietors, partnerships, or corporations. It is here where most of the property taxes paid by agriculture on land and machinery are likely reported and losing the ability to expense state and local taxes would result in a significant increase in federal taxes. Fortunately, according to the lobbyist for American Farm Bureau, the ability to expense state and local taxes as a business expense will continue. Congressional leaders have indicated the repeal of the state and local taxes deduction would only apply on individual returns, and not affect the expensing of taxes by businesses. But stay tuned, the reform discussions are now beginning in earnest, and no one can predict what might happen.
Jay Rempe is the senior economist for Nebraska Farm Bureau. Rempe’s background in agricultural economics, years of experience in advocating at the state capitol, and firm grasp of issues allow him to quantify the fiscal impact of a regulatory proposal, and provide in-depth examination of key issues affecting Nebraska’s farmers and ranchers.
¾-1 lb. chicken breast, cut into bite-sized pieces
3 tablespoons cooking oil
1 15-oz. jar Alfredo sauce or make a white sauce using 2 tablespoons butter, 3 tablespoons flour, 15 oz. milk, and salt to taste. If using a white sauce, add ¼ cup Parmesan cheese to the sauce.
½ bottle (approx. 6 oz.) buffalo sauce
1 cup shredded mozzarella cheese
Cook noodles until al dente; drain.
Preheat oven to 350º.
While pasta is cooking, heat oil in a skillet. Season chicken pieces with salt, pepper, garlic powder, and Italian seasoning. Cook in oil until no pink remains.
Prepare white sauce if not using Alfredo sauce. In a 2-cup glass measuring cup, melt butter in the microwave. Stir in the flour and salt. Add milk and stir. Cook in the microwave, stirring every 30 seconds until the sauce thickens and boils. Stir in the Parmesan cheese.
Add the chicken, white sauce, buffalo sauce, and ½ cup mozzarella cheese to the pasta. Stir to combine. Pour into a 9”x9” baking dish. Sprinkle remaining mozzarella cheese over the top.
Note: Directions are for using a mixer with a dough hook, but this bread can be easily be made by hand.
In a large mixer bowl, combine 1 ¼ cups bread flour, yeast, and salt; blend well.
Heat 1 cup water, molasses, vegetable oil, and oatmeal until warm (120-130º).
Add the liquid mixture to the flour mixture. Using the mixing paddle, blend at a low speed until moistened, then beat 3 minutes at medium speed. Add whole wheat flour and nuts. Mix to combine.
Change to the dough hook. Add enough remaining bread flour to make a firm dough. Knead for 3 minutes.
Turn onto a lightly floured board. Work the dough into a ball with a smooth surface. Place in a lightly oiled bowl and turn to oil the top. Cover; let rise in a warm place until double (30 minutes-1hour).
Turn the dough onto a lightly floured surface; punch down to remove air bubbles. Shape into a round loaf. Place on a greased cookie sheet. Cover; let rise in a warm place until doubled (approximately 1 hour).
Combine egg and 1 tablespoon of water; brush the top of the loaf. Optional—you may sprinkle with oatmeal.
Bake in a preheated 375º oven for 30-40 minutes. Remove from cookie sheet and place on a cooling rack.
½ cup butter, softened
½ cup creamy peanut butter
½ cup sugar
½ cup packed light brown sugar
1 large egg
½ teaspoon vanilla extract
1-1/4 cups all-purpose flour
3/4 teaspoon baking soda
½ teaspoon salt FUDGE FILLING:
1 cup milk chocolate chips
1 cup semisweet chocolate chips
1 can (14 ounces) sweetened condensed milk
1 teaspoon vanilla extract
Chopped peanuts Directions
1. In a large mixing bowl, cream butter, peanut butter and sugars until blended. Beat in egg and vanilla.
2. In a small bowl, whisk flour, baking soda and salt; gradually beat into creamed mixture. Refrigerate the dough, covered for1 hour or until easy to handle.
3. Preheat oven to 325°. Shape into 1-inch balls. Place dough balls in greased mini-muffin cups.
4. Bake 14-16 minutes or until light brown. Remove from the oven and immediately press a 1/2-in.-deep indentation in center of each cookie with the end of a wooden spoon handle or a mini-tart shaper.
5. Cool the tarts in the pan for 5 minutes. Remove to wire racks to cool completely.
6. For the filling, in a microwave, melt chocolate chips; stir until smooth.
7. Whisk in sweetened condensed milk and vanilla until smooth.
8. Fill each cookie with filling. Sprinkle with peanuts. (If desired, refrigerate remaining filling; serve warm with ice cream.)