The Effect on Family Farms of Changing Capital Gains Taxation at Death

Tia M. McDonald, Ron Durst and Christine Whitt

No 320794, Economic Brief from United States Department of Agriculture, Economic Research Service

Abstract: This report presents a method for assessing impacts of changes to capital gains taxation at death for family farm estates, an approach which accounts for the structural changes in a person’s wealth portfolio that often occurs as a person ages. The method is applied to the American Families Plan, which proposes to eliminate stepped-up basis for inherited assets greater than $1 million for individuals’ estates and $2 million for married couples’ estates while deferring capital gains tax liability on business assets as long as the business remains family operated. The results suggest that of the estimated 32,174 family farm estates in 2021, 1.1 percent would owe capital gains taxes at death, 18.2 percent would not owe capital gains taxes at death but could have deferred tax liability if the farm assets do not remain family-owned and operated, and 80.7 percent would have no change to their capital gains tax liability.

Keywords: Farm Management; Financial Economics; Land Economics/Use; Research Methods/ Statistical Methods (search for similar items in EconPapers)
Pages: 23
Date: 2021-09
New Economics Papers: this item is included in nep-acc
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/320794/files/eb-31.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:uerseb:320794

DOI: 10.22004/ag.econ.320794

Access Statistics for this paper

More papers in Economic Brief from United States Department of Agriculture, Economic Research Service Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().