“All good men and women must take responsibility to create legacies that will take the next generation to a level we could only imagine.” — Jim Rohn
Who doesn’t want to leave this earth better than they found it and leave their children a solid foundation to build on? My husband and I do. That is our goal on our family farm but every year that dream is threatened by uncertainties in the tax code. Our lawmakers can bring relief to farm and ranch families across the country with tax reform, but first, we must help them see the impact certain tools and provisions have on our ability to stay in business.
My family’s story is quite simple and yet far too common among farm families. We are three generations farming together: my husband and I, my in-laws, and our grown children. Part of my role on the family farm is bookkeeper, tracking our income and expenses in order to plan day-to-day business wisely while also preparing our transition and succession plan. Every time there is a change or delay in any part of the tax code it costs our family time and money. This uncertainty takes income from farm growth with no promise of securing a future for the farm and family.
We want our children to have the freedom to keep on with the family farm business — rather than being forced to sell off farmland to cover an insurmountable tax burden. Take for example the impact the estate tax has on a family business like ours. In 2016 alone we spent thousands of dollars and hundreds of hours to update our will and set the path to transfer ground and equipment in the best way possible. It’s also not easy to schedule timely appointments with accountants, lawyers and business consultants. That money and time could have been better spent on much-needed farm improvements instead, but safeguarding our business had to come first. There is no guarantee that we won’t have to do this again next year without permanent changes to the tax code. How much more time, money and opportunity will we lose because of ever-changing estate tax law?
With the House and Senate tax bills yet to be reconciled, the exact fate of the estate tax remains to be seen. If estate taxes were repealed, however, our family would know how to plan every year, so we can keep running the family business and pass it on to the next generation without the fear of losing our most valuable asset, the very land we farm. This is a support all young farmers need if we’re going to continue growing a safe and stable food supply. Until repeal is achieved, however, raising the exemption on estate taxes will bring much-needed relief to many farm and ranch families.
Our lawmakers can’t change the weather or markets to make farming less risky, but they can certainly craft a tax code that gives family farms the freedom to stay in business from one generation to the next.
Isabella Chism, vice chair of the American Farm Bureau Women’s Leadership Committee, farms with her family in Galveston, Ind. Her column appears courtesy of the American Farm Bureau.