A farm tax and accounting expert says there is good reason to be concerned about President Biden’s proposed tax law changes. Neil Narveson with Compeer Financial tells Brownfield Biden’s plan to raise capital gains taxes and eliminate what is called step-up-basis can get very expensive for property owners selling or transferring to the next generation. “This isn’t just amongst farmers, it’s amongst everybody. Let’s say your parents have a house and it’s not on the farm, it’s just a house and they die and they pass it to you, that’s going to get hit with not having stepped-up-basis just like everything else, so this is very concerning for many of our clients, especially those who have farms that could be passed on to the next generation in the coming years.”
Narveson says the step-up-basis allows calculation of capital gains taxes from the fair market value at the time of transfer or sale, not the difference between the current value and the original purchase price many years ago.
