U.S. Rep. Kristi Noem (R-SD) last week brought home good news to her constituents about her fight to repeal the death tax, as well as additional tax reform measures supporting farmers and ranchers.
Noem on Saturday visited the South Dakota Farm Bureau Centennial Convention to announce that provisions contained in her Death Tax Repeal Act of 2017, H.R. 631, formed the foundation and were included in the sweeping, 400-page House tax reform bill, H.R. 1, approved on Nov. 16.
Noem’s provisions in H.R. 631 include lower tax rates, like-kind exchange provisions, and immediate expensing in addition to full and permanent repeal of the death tax.
“Many South Dakotans have heard my story,” Noem said on Saturday at the convention. “After my dad died in a farming accident, we were hit by the death tax, which affected our operation for nearly a decade.”
“Our farm has been in the family for more than a century,” she said. “The tax reform proposal we’re working on is designed to help farms across South Dakota last a century more. I’m thrilled the House tax reform bill would finally get rid of this un-American tax.”
Hundreds of South Dakotans whom Noem met with offered input that helped her develop the included tax reform provisions, according to her office.
Specifically, H.R. 1, the comprehensive tax reform legislation, would repeal the death tax by 2025, doubling the exclusion for the first seven years and maintaining a stepped-up basis for asset value determination. Immediate expensing would allow taxpayers to depreciate 100 percent of qualified expenses the year they are purchased. And expensing benefits would be extended to assets for which the taxpayer is not the original owner. Cash accounting also would be expanded, allowing producers to avoid paying taxes on things before they have received payment for them.
“It’s not just the death tax that disproportionately impacts South Dakota producers,” Noem said. “Almost any farmer you talk to will tell you that taxes are too high. We’re going to change that.”
Through tax reform, significantly lowering tax rates and doubling the standard deduction will make a big difference in the tax bill producers receive, Noem told convention attendees.
Additionally, several expensing tools, which are critical for highly leveraged industries like agriculture, also will provide relief, she said.
“This is a proposal designed with farmers and ranchers in mind. It’s designed to keep more money in their pockets,” said Noem, one of the only farmers and ranchers on the House Ways and Means Committee.
South Dakota Farm Bureau President Scott VanderWal applauded Noem’s tax-reform work, saying it “takes a big step toward rewarding rather than punishing hard work and success.”
And Noem’s “hard work and persistence have made our progress to date possible and [she] is our greatest asset in the serious fight to kill the death tax once and for all,” said Grover Norquist, president of Americans for Tax Reform.
Like the House, the Senate Finance Committee later in the day on Nov. 16 passed its version of the tax package, sending it to the full Senate to consider after the Thanksgiving break.