A COALITION of 25 agricultural stakeholders sent a letter to Senate Finance Committee members, who are meeting internally on taxes impacting small businesses.
"Due to uncertain and fluctuating income that results from weather-induced production variations and unpredictable markets that create price uncertainty for the products they produce, we need a tax code that allows farmers and ranchers to manage the risks associated with agriculture while complying with tax liabilities," the groups said.
"Cash accounting, combined with the ability to accelerate expenses and defer income, gives farmers and ranchers the flexibility they need to manage their tax burden. Section 179 small business expensing provides agricultural producers with a way to maximize business purchases in years when they have positive cash flow. For these reasons, we warn against reducing the number of farms and ranches eligible to use cash accounting and support maintaining the current $500,000 Section 179 small business expensing limitation and the $2 million acquisition limit," they added.
The groups also encouraged implementation of a permanent five-year depreciation schedule for agricultural equipment and an expansion of the special use valuation for estate tax purposes.