Benjamin Franklin once said, “In this world, nothing is certain except death and taxes.” But for Missouri farmers, taxes are about to become a lot more uncertain. Barring action from Congress, many key tax provisions from the 2017 Tax Cuts and Jobs Act will expire at the end of 2025, leading to a significant tax increase for our state’s agricultural industry.

For farmers and small business owners, this is cause for concern as our industries were large proponents of the original bill. Almost all the individual tax brackets would increase if not extended, and the standard deduction for tax filers would be reduced by half. According to the American Farm Bureau Federation, farmers will face well over a nine-billion-dollar tax increase in 2026 between higher income tax liability and an increased estate tax liability without an extension from Congress.

This sunset also includes a nearly 50 percent reduction in the exemption limit for the estate tax. Farm Bureau has a long-standing policy against the estate tax, and we have advocated for its complete repeal for decades. In the absence of a full repeal, we have always supported increases to the exemption level, to ensure as few Missouri families are subject to this onerous tax as possible. With land values continuing to rise, the number of acres it takes to reach these thresholds is shrinking year by year.

Congress must take action to ensure this needed relief is extended beyond 2025. The good news is that Missouri has a strong advocate in Congressman Jason Smith, who also serves as the Chairman of the House Ways and Means Committee. A staunch supporter of the rural way of life and a past recipient of MOFB’s Outstanding Service to Agriculture Award, Congressman Smith will play a critical role in shaping tax policy moving forward.

The House of Representatives took a step forward earlier this spring when they passed a bill that would extend 100 percent bonus depreciation, retroactive to 2023, through the end of 2025 and raise the cap on Section 179 expensing. This is welcome news to be sure, but more work remains.

As with all things related to taxes, we always recommend that you reach out to your accountant or your attorney to set up a plan that works for your individual farm. Furthermore, talk to your elected officials about the importance of these tax provisions and how we can work together to continue this needed relief.